NEW DELHI: The Finance Minister announced on Saturday cuts in personal income tax, extended tax benefits for affordable housing and provided relief to businesses by paying dividends in the Union Budget for 2020-21, while the The government sought to boost consumption to get the economy out of the worst slowdown in 11 years.
The minister proposed increasing customs tariffs on a variety of products ranging from crockery and kitchen utensils, appliances to footwear, furniture, stationery and toys to give equal conditions to national companies and promote 'Make in India'.
By offering an optional lower income tax rate to individuals, Sitharaman in its 2020-21 Budget proposed new tax slabs of 15 percent and 25 percent, in addition to 10 percent, 20 percent and 30 percent. hundred existing. The new I-T slabs would be for people who do not have certain specific deductions or exemptions.
According to the proposed I-T slab, the annual income up to Rs 2.5 lakh is tax free. Those individuals who earn between Rs 2.5 lakh and Rs 5 lakh will pay a 5 percent tax. The income between Rs 5 and 7.5 lakh will be taxed with 10 percent, while those between Rs 7.5 and 10 lakh with 15 percent.
Live plus Those who earn between Rs 10 and 12.5 lakh will pay taxes at a rate of 20 percent, while those between Rs 12.5 and Rs 15 lakh will pay a rate of 25 percent. Revenue above Rs 15 lakh will be taxed with 30 percent.
Individuals who opt for taxes under the new rates will not be entitled to exemptions/deductions, including the provisions of Section 80C and 80D, LTC, housing rental subsidy, entertainment deduction, professional tax and interest on occupied/unoccupied properties.
Currently, the annual income up to Rs 2.5 lakh is exempt from I-T. While a 5 percent tax is charged for income between Rs 2.5 and 5 lakh. 20 percent for income between Rs 5 lakh and Rs 10 lakh and 30 percent for those who earn above Rs 10 lakh.
The new tax regime will be optional for taxpayers, he said.
"The proposed tax structure will provide significant relief to taxpayers and plus so to those in the middle class," Sitharaman added.
To boost growth, Sitharaman announced higher expenses in infrastructure, rural development and agricultural sector.
The Finance Minister said the government proposes a 16-point action plan to boost agriculture and farmers' welfare.
Agricultural services need large investments, he said, adding that the government has secured 6.11 crore farmers under Pradhan Mantri Fasal Bima Yojna.
With its corporate tax cut for the 2019-20 budget after drilling a 1.45 lakh rupee hole in government revenue, the minister raised the fiscal deficit target for the current tax to 3.8 percent of GDP, from 3, 3 percent
For 2020-21, it set the fiscal deficit at 3.5 percent.