Presenting an interim budget for 2019-20 in Parliament, Union Minister for Finance and Corporate Affairs Piyush Goyal said additional funds, if necessary, would be provided to secure the country's borders and maintain defence preparedness. There will be no tax on notional rent on second self-occupied house and no TDS on house rent up to Rs 2.4 lakh, " said Goyal.
For those, he said, whose return of income or taxable return is more than Rs 5 lakh, the old slab of tax rates will continue."There is no change in that because this is an interim budget and it has been targeted that the small taxpayers, middle-class and lower middle-class taxpayers should have a certainty of their tax liability on April 1". Income from Rs 3 lakh to Rs 5 lakh is taxed at 5 per cent, and an income from Rs 5 lakh to Rs 10 lakh at 20 per cent and above Rs 10 lakh at 30 per cent.
Among the major sops, Goyal has also announced Rs 6,000 per annum direct cash transfer to farmers owning less than 2 hectares of land.
- Benefit of rollover of capital tax gains to be increased from investment in one residential house to that in two residential houses, for a taxpayer having capital gains up to 2 crore rupees; can be exercised once in a lifetime. The move, months before general elections, is likely to benefit 12 crore farmers.
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PM Modi said that there has always been a demand to exempt those with annual income up to Rs 5 lakh and Modi government fulfilled it. Income from Rs 5 lakh to Rs 10 lakh was taxed at 20 per cent and above Rs 10 lakh was at 30 per cent. "As per the present taxation rate, the tax liability up to Rs 5 lakh is Rs 12,500".
The interim budget leaves unchanged the cess on income tax that Finance Minister Arun Jaitley raised to 4 per cent from 3 per cent in the FY2019 budget. Rs 60,000 crore has also been set aside for MGNREGA, the rural employment scheme, with Piyush Goyal adding that the allocation can be increased further.
The tax proposals have evinced mixed reaction from tax experts.
Standard deduction, too, has also been raised to Rs 50,000 from Rs 40,000.
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