New Delhi: Finance Minister Arun Jaitley will present the Budget for 2016-17 on February 29. The salaried class has a lot of expectations from the Budget. Increase in the personal income tax exemption limit up to Rs 3 lakh and a higher deduction limit under Section 8OC up to Rs 2 lakh, say analysts.
FM Arun Jaitley is likely to hike the exemption limit in personal income tax from Rs 2.5 lakh to Rs 3 lakh.
Finance Minister Arun Jaitley will hike the exemption limit in personal income tax from Rs 2.5 lakh to Rs 3 lakh.
He also may raise the tax exemption limit for investments to Rs 2 lakh from the current Rs 1.5 lakh under Section 80C of the Income Tax Act.
Not just that, the Minister is likely to hike the tax deduction limit to Rs 2.5 lakh from Rs 2 lakh on interest for housing loans in case of self-occupied property while the public provident fund (PPF) investment limit will also be raised to Rs 2 lakh from the current Rs 1.5 lakh.
In a nutshell, these measures do not only mean more money in your hands, there will also be more incentives to park it in national savings certificates (NSC), five-year fixed deposits, repayment of principal amount of home loans, children’s tuition fees, specific mutual funds and life insurance premium among other things. The three income tax slabs — at 10%, 20% and 30% — however, will be left undisturbed.
In our country, just 3 percent of the people pay income tax, which comes to 3.5 crore tax payers, among them top majority of the tax payers fall 10% slab. Just as comparison in USA around 45 percent of the population pays taxes.
So, it will provide much-needed relief to the salaried middle class, which has been reeling under the impact of high inflation.
