Income upto Rs 5 Lakh to get full tax rebate; higher standard deduction proposed
The main highlights of the Interim Budget 2019-20 presented by the Union Minister for Finance, Corporate Affairs, Railways & Coal, Shri Piyush Goyal in Parliament today are as follows:
New Announcements
Farmers
· 12 crore small and marginal farmers to be provided with assured yearly income of Rs. 6000 per annum under PM-KISAN
o Outlay of Rs. 75,000 crore for FY 2019-20 with additional Rs. 20,000 crore in RE 2018-19
· Outlay for Rashtriya Gokul mission increased to Rs 750 crore
· Rashtriya Kamdhenu Ayog to be setup for sustainable genetic up-gradation of the Cow resources
· New separate Department of Fisheries for welfare of 1.5 crore fishermen
· 2% interest subvention to Farmers for Animal husbandry and Fisheries activities; additional 3% in case of timely repayment.
· Interest subvention of 2% during disaster will now be provided for the entire period of reschedulement of loan
Labour
· Pradhan Mantri Shram Yogi Maandhan scheme to ensure fixed monthly pension to 10 crore unorganized sector workers
o Rs 3000 per month after 60 years of age with an affordable contribution of only Rs 100/55 per month
Health
· 22nd AIIMS to be setup in Haryana
MGNREGA
· Rs. 60, 000 crore allocation for MGNREGA in BE 2019-20
Direct Tax proposals
· Income upto Rs. 5 lakh exempted from Income Tax
· More than Rs. 23,000 crore tax relief to 3 crore middle class taxpayers
· Standard Deduction to be raised to Rs. 50,000 from Rs. 40,000
· TDS threshold to be raised from Rs. 10,000 to Rs. 40,000 on interest earned on bank/post office deposits
· Existing rates of income tax to continue
· Tax exempted on notional rent on a second self-occupied house
· Housing and real estate sector to get boost-
o TDS threshold for deduction of tax on rent to be increased from Rs. 1,80,000 to Rs. 2,40,000
o Benefit of rollover of capital gains increased from investment in one residential house to two residential houses for capital gains up to Rs. 2 crore.
o Tax benefits for affordable housing extended till 31st March, 2020 under Section 80-IBA of Income Tax Act
o Tax exemption period on notional rent, on unsold inventories, extended from one year to two years
MORE RELIEF TO RESIDENTIAL HOUSES
Further, the Finance Minister proposed to increase the benefit of rollover of capital gains under Section 54 of the Income Tax Act from investment in one residential house to two residential houses for a taxpayer having capital gains up to Rs. 2 crore. This benefit can be availed once in a life time. For making more homes available under affordable housing, the benefits under Section 80-IBA of the Income Tax Act is being extended for one more year, i.e., to the housing projects approved till 31st March, 2020. Also, for giving impetus to the real estate sector, the Finance Minister proposed to extend the period of exemption from levy of tax on notional rent, on unsold inventories, from one year to two years, from the end of the year in which the project is completed.
MORE RELIEF TO RESIDENTIAL HOUSES
It has been proposed to exempt the levy of income tax on notional rent on a second self-occupied house. Currently, income tax on notional rent is payable if one has more than one self-occupied house. Shri Goyal announced the relief considering the difficulty of the middle class having to maintain families at two locations on account of their job, children’s education, care of parents etc.
Defence
· Defence budget to cross Rs 3,00,000 crore for the first time ever
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Ministry of FinanceFM announces a slew of tax reliefs for middle class and small tax payers
Posted On: 01 FEB 2019 1:45PM by PIB Delhi
Individual taxpayers having taxable annual income up to Rs.5 lakhs will get full tax rebate and therefore will not be required to pay any income tax. While presenting the Interim Budget 2019-20 in Parliament today the Union Minister for Finance, Corporate Affairs, Railways & Coal, Shri Piyush Goyal said “Because of major tax reforms undertaken by us during last four and half years, both tax collections as well as tax base have shown significant increase, achieving a moderate taxation- high compliance regime. It is, therefore, just and fair that some benefits from the tax reforms must also be passed on to the middle class taxpayers”
As a result, the Finance Minister added that even persons having gross income up to Rs. 6.50 lakhs may not be required to pay any income tax if they make investments in provident funds, specified savings, insurance etc. In fact, with additional deductions such as interest on home loan up to Rs.2 lakh, interest on education loans, National Pension Scheme contributions, medical insurance, medical expenditure on senior citizens etc, persons having even higher income will not have to pay any tax. This will provide tax benefit of Rs.18,500 crore to an estimated 3 crore middle class taxpayers comprising self employed, small business, small traders, salary earners, pensioners and senior citizens.
STANDARD DEDUCTIONS RAISED
For salaried persons, Standard Deduction is being raised from the current Rs.40,000 to Rs.50,000. “This will provide additional tax benefit of Rs.4,700 crore to more than 3 crore salary earners and pensioners”, the Finance Minister informed.
TDS THRESHHOLD INCREASED
Tax Deduction at Source (TDS) threshold on interest earned on bank/post office deposits has been proposed to be raised from Rs.10,000 to Rs.40,000. Shri Goyal said, “This will benefit small depositors and non-working spouses”. Further, the TDS threshold for deduction of tax on rent has also been proposed to be increased from Rs.1,80,000 to Rs.2,40,000 for providing relief to small taxpayers.
MORE RELIEF TO RESIDENTIAL HOUSES
It has been proposed to exempt the levy of income tax on notional rent on a second self-occupied house. Currently, income tax on notional rent is payable if one has more than one self-occupied house. Shri Goyal announced the relief considering the difficulty of the middle class having to maintain families at two locations on account of their job, children’s education, care of parents etc.
Further, the Finance Minister proposed to increase the benefit of rollover of capital gains under Section 54 of the Income Tax Act from investment in one residential house to two residential houses for a taxpayer having capital gains up to Rs. 2 crore. This benefit can be availed once in a life time. For making more homes available under affordable housing, the benefits under Section 80-IBA of the Income Tax Act is being extended for one more year, i.e., to the housing projects approved till 31st March, 2020. Also, for giving impetus to the real estate sector, the Finance Minister proposed to extend the period of exemption from levy of tax on notional rent, on unsold inventories, from one year to two years, from the end of the year in which the project is completed.
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Ministry of Finance
Government proposes to launch mega pension yojana 'Pradhan Mantri Shram-Yogi Maandhan' for unorganised sector workers with monthly income upto rs. 15,000; 10 Crore Labourers and workers in the sector to be benefitted
Posted On: 01 FEB 2019 1:36PM by PIB Delhi
The Government proposes to launch a mega pension yojana namely 'Pradhan Mantri Shram-Yogi Maandhan'for the unorganised sector workers with monthly income upto Rs. 15,000. While presenting the Interim Budget 2019-20 in Parliament today, the Union Minister for Finance, Corporate Affairs, Railways and Coal, Shri Piyush Goyal said that half of India’s GDP comes from the sweat and toil of 42 crore workers in the unorganised sector working as street vendors, rickshaw pullers, construction workers, rag pickers, agricultural workers, beedi workers, handloom, leather and in numerous other similar occupations. The Government must provide them comprehensive social security coverage for their old age. Therefore, in addition to the health coverage provided under ‘Ayushman Bharat’ and life & disability coverage provided under ‘Pradhan Mantri Jeevan Jyoti Bima Yojana’ and ‘Pradhan Mantri Suraksha Bima Yojana’, our Government proposes to launch a mega pension yojana namely 'Pradhan Mantri Shram-Yogi Maandhan' for the unorganised sector workers with monthly income upto Rs. 15,000.
Shri Goyal said that this pension yojana shall provide them an assured monthly pension of Rs. 3,000 from the age of 60 years on a monthly contribution of a small affordable amount during their working age. An unorganised sector worker joining pension yojana at the age of 29 years will have to contribute only Rs. 100 per month till the age of 60 years. A worker joining the pension yojana at 18 years, will have to contribute as little as Rs. 55 per month only. The Government will deposit equal matching share in the pension account of the worker every month. It is expected that at least 10 crore labourers and workers in the unorganised sector will avail the benefit of 'Pradhan Mantri Shram-Yogi Maandhan' within next five years making it one of the largest pension schemes of the world. A sum of Rs. 500 crore has been allocated for the Scheme. Additional funds will be provided as needed. The scheme will also be implemented from the current year.
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