TAX PROPOSALS
Direct Taxes
„ Exemption limit for the general category of individual taxpayers enhanced from
` 1,60,000 to ` 1,80,000 giving uniform tax relief of ` 2,000.
„ Exemption limit enhanced and qualifying age reduced for senior citizens.
„ Higher exemption limit for Very Senior Citizens, who are 80 years or above.
„ Current surcharge of 7.5 per cent on domestic companies proposed to be reduced
to 5 per cent.
„ Rate of Minimum Alternative Tax proposed to be increased from 18 per cent to
18.5 per cent of book profits.
„ Tax incentives extended to attract foreign funds for financing of infrastructure.
„ Additional deduction of ` 20,000 for investment in long-term infrastructure bonds
proposed to be extended for one more year.
„ Lower rate of 15 per cent tax on dividends received by an Indian company from
its foreign subsidiary.
„ Benefit of investment linked deduction extended to businesses engaged in the
production of fertilisers.
„ Investment linked deduction to businesses developing affordable housing.
„ Weighted deduction on payments made to National Laboratories, Universities
and Institutes of Technology to be enhanced to 200 per cent.
„ System of collection of information from foreign tax jurisdictions to be
strengthened.
„ A net revenue loss of ` 11,500 crore estimated as a result of proposals.
Indirect Taxes
„ To stay on course for transition to GST.
„ Central Excise Duty to be maintained at standard rate of 10 per cent.
„ Reduction in number of exemptions in Central Excise rate structure.
„ Nominal Central Excise Duty of 1 per cent imposed on 130 items entering in the
tax net.
„ Lower rate of Central Excise Duty enhanced from 4 per cent to 5 per cent.
„ Optional levy on branded garments or made up proposed to be converted into a
mandatory levy at unified rate of 10 per cent.
„ Peak rate of Custom Duty held at its current level
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