Finance Minister Pranab Mukherjee on Monday raised the income tax exemption limit raised by Rs 20,000 in his Budget proposals for 2011-12. So individual taxpayers will now get income tax exemption till an annual income of Rs 1.8 lakh (Rs 180,000).
This will provide thousands of taxpayers some relief. The finance minister said that each taxpayer will save Rs 2,000 per year because of this proposal.
With the Direct Taxes Code to come into affect in 2012, the finance minister did what was expected.
For Senior Citizens the qualifying age for tax exemption has been reduced from 65 years to 60 years. This means many more taxpayers will now benefit due to this proposal.
For senior citizens, the tax exemption limit too has been increased to Rs 2.5 lakh (Rs 250,000) from Rs 240,000 earlier.
Creating a new category -- Very Senior Citizens -- the finance minister said that people of the age of 80 and above will fall into this category.
They Very Senior Citizens will get tax exemption up to an annual income of Rs 5 lakh (Rs 500,000).
Women: Women have got a raw deal from the finance minister in this Budget, as Pranab Mukherjee did not give any tax relief to them keeping their tax exemption limit the same as last year's: Rs 240,000.
Tax on corporates:
- Tax procedures for small businesses to be simplified.
- Minimum alternative tax raised to 18.5% from 18%.
- Service tax retained at 10%.
- Base rate on excise duty raised to 5% from 4%
- To withdraw 130 items from exemption under Central Excise.
- Central excise duty rate unchanged at 10%.
- Tax sops of Rs 20,000 on Infra Bonds extended for one year.
- Foreign unit dividend tax rate cut to 15 per cent for Indian companies.
- Special Economic Zones to come under MAT.
- Tax sops of Rs 20,000 on Infra Bonds extended for one year.
Cut in import duties of raw material for mobile phones.
- Net tax to Centre will be Rs 6,64,457 cr. Non-tax receipts pegged at Rs 1,25,435 cr
- 10% excise duty on branded garments
- Basic food, fuel exempted from central excise duty.
- 1% excise duty on 130 new items.
- Standard rate of Central Excise retained at 10%.
- Service tax retained at 10%.
- Direct tax sops to result in revenue loss of Rs 11,500 crore.
- Foreign unit dividend tax rate cut to 15% for Indian firms.
- Surcharge on domestic firms cut to 5% from 7.5%.
- Net tax to Centre will be Rs 6,64,457 cr. Non-tax receipts pegged at Rs 1,25,435 crore.
- FY 12 fiscal deficit seen at Rs 4.12 lakh crore
- Budget estimates for 2011-12 projects Rs 9,32,440 crore - an increase of 24 pe
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