A parliamentary panel reviewing the Direct Taxes
Code (DTC) bill has recommended raising the income tax exemption limit to Rs.3
lakh a year and the investment limit for tax saving schemes to Rs.3.20 lakh.
The current tax exemption limit stands at Rs.1.80 lakh.
The Standing Committee on Finance on the DTC bill, headed by former finance minister Yashwant Sinha, has proposed that a 10 percent tax be levied on income between Rs.3-10 lakh, 20 percent between Rs.10-20 lakh and 30 percent on income over Rs.20 lakh.
The DTC had earlier proposed income tax exemption limit at Rs.2 lakh, 10 percent tax on income between Rs.2-5 lakh, 20 percent for Rs.5-10 lakh and 30 percent on income above Rs.10 lakh.
The committee has also suggested that the Securities Transaction Tax (STT) be abolished and the wealth tax limit be pegged at Rs.5 crore.
As regards the rate, it said the wealth tax should be charged at 0.5 percent on assets between Rs.5-20 crore, 0.7 percent on assets between Rs.20-50 crore and 1 percent above Rs.50 crore. The wealth tax rate now is 1 percent.
The STT is a levy on transactions in the stock market i.e. on purchase or sale of shares, derivatives and equity-oriented mutual funds.
---courtesy of SME Times News Bureau
The current tax exemption limit stands at Rs.1.80 lakh.
The Standing Committee on Finance on the DTC bill, headed by former finance minister Yashwant Sinha, has proposed that a 10 percent tax be levied on income between Rs.3-10 lakh, 20 percent between Rs.10-20 lakh and 30 percent on income over Rs.20 lakh.
The DTC had earlier proposed income tax exemption limit at Rs.2 lakh, 10 percent tax on income between Rs.2-5 lakh, 20 percent for Rs.5-10 lakh and 30 percent on income above Rs.10 lakh.
The committee has also suggested that the Securities Transaction Tax (STT) be abolished and the wealth tax limit be pegged at Rs.5 crore.
As regards the rate, it said the wealth tax should be charged at 0.5 percent on assets between Rs.5-20 crore, 0.7 percent on assets between Rs.20-50 crore and 1 percent above Rs.50 crore. The wealth tax rate now is 1 percent.
The STT is a levy on transactions in the stock market i.e. on purchase or sale of shares, derivatives and equity-oriented mutual funds.
---courtesy of SME Times News Bureau
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