Higher Income Tax Exemption Slab – Biggest Demand from Modi Government’s Last Budget

The present income tax slabs make anyone earning above Rs.2,50,000/- per year liable to pay 5% income tax on the taxable income arrived after various tax deductions and exemptions.

Budget 2019: Higher Income Tax Exemption slab has turned out to be the biggest demand of not just the common man but of industry bodies like CII and FICCI too, from the Modi government’s last budget which is due on 1st February 2019, for its current tenure. (PTI)

Budget 2019: Higher Income Tax Exemption slab has turned out to be the biggest demand of not just the common man but of industry bodies like CII and FICCI too, from the Modi government’s last budget which is due on 1^st February 2019, for its current tenure. The present income tax slabs make anyone earning above Rs.2,50,000/- per year liable to pay 5% income tax on the taxable income arrived after various tax deductions and exemptions. However, given the current salary slabs of the private as well as the public sector employees, a major chunk of the earning population comes under the ambit of paying income tax every year. While Confederation of Indian Industry (CII) has recommended the government to double the tax exemption slab from 2.5 lac to 5 lac; the Federation of Indian Chambers of Commerce and Industry (FICCI) has suggested the peak income tax rate i.e. 30% for income above 10 lac currently, to be applicable for income beyond 20 lac to bring it par with the international economies. In Budget 2018, Finance Minister Arun Jaitley had put forward, “The government provided enough tax relief to the salaried class in the last three years. I do not propose any further changes in the income tax front”, while introducing standard deduction of Rs.40,000 without doling out any other perks to the income tax payers. However, given the pressure from industry bodies and general elections 2019, the Bharatiya Janta Party is expected to change its stand on a populist budget and may raise the Income Tax Exemption slab to 5 lacs if not 7 lacs as demanded by various employee associations. On a positive outlook, Budget 2019 may bring in a sigh of relief in the form of lower income tax burden to the common man. Stay Tuned!