Budget 2019: How this suggestion by CII on income tax exemption will bring relief to common man

With Interim Budget 2019 on the anvil, the Confederation of Indian Industry (CII) has issued its own set of suggestions for the Finance Ministry to consider.

The suggestion by CII will bring relief to the common man. (Image: PTI)

Budget 2019: Income Tax undoubtedly is the most important aspect of any budget and with Interim Budget 2019 on the anvil, the Confederation of Indian Industry (CII) has issued its own set of suggestions for the Finance Ministry to consider. CII’s top-most suggestion to the BJP-led National Democratic Alliance (NDA) is to increase the Income Tax Exemption Limit to from the current 2.5 lac to 5 lac. This slab at present attracts 5 per cent income tax after all deductions, and has already been tweaked by the Finance Ministry, first in 2014 when the income tax exemption slab was raised to 2.5 lac from then 2 lac under UPA, and again in 2017 when the FM slashed the 10% Income Tax rate by half to make it the current 5 per cent. However, CII yesterday pitched a complete reboot of the current Income Tax structure as given below: Given the average income a middle-class household earns as of FY2018-19, the suggestion by CII will bring relief to the common man whose income easily falls between the 5 to 10 lac slab. The CII has further proposed to increase the exemption limit from the current 1.5 lac to 2.5 lac for items exempted under Section 80 C to benefit the banking sector by giving tax-exemption to individuals who invest money in the financial instruments that are part of Section 80 C. CII also advised the centre on bringing back the medical and transport allowance that was done away with last year in Budget 2018 when the FinMin reintroduced Standard Deduction of Rs 40,000. The BJP government has the right set of recommendations from the CII, and if it is adopted by the centre, it’ll not only benefit the common man and the middle class, but also the incumbent to return to power in FY 2019-20 and beyond. After all, what more can the Aam Aadmi demand or dream of for Income Tax restructuring in 2019 from what’s proposed by the CII?