The government on wednesday introduced the new DIRECT TAX CODE. The new code has far reaching effect and attempts at simplifying the entire 47 year old tax structure of the country . The new code will become law only in 2011. The sailent features of the new code are given below :
- Income tax rates slashed
- Most exemptions to go
- Interest on savings to be taxed
· Tax code proposes 10% tax on Rs 10 lakh income
- Up to Rs 1.6 lakh: No tax
- 10 per cent tax for Rs 10 lakh income(Rs 1.2 lakh in hand)
- 20 per cent tax for Rs 25 lakh income (Rs 2.60 lakh more in hand)
- 30 per cent tax for income over Rs 25 lakh
- To raise deduction limits for savings upto Rs 3,00,000
- Corporate Tax: Down from 30 per cent to 25 per cent
- Wealth tax to be levied for wealth above Rs 50 crore
- Diff between LTCG and STCG to go
- MAT reduced to 2%
- No interest on self occupied house
- Business loss can be carried forward indefinitely
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