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Wednesday, October 2, 2019

Income Taxes may be reduced

Income Taxes may be reduced

Taxes on income of Rs 5 lakh to 10 lakh may be reduced from 20% to 10%, announcement before Diwali

  • Claim in Media Report - Tax rate on income above 1 lakh income is likely to be 25% instead of 30%
  • Consider removing the surcharge, cess and removing some relaxation options

The government may lower the income tax rate before Diwali. According to a media report, taxes on incomes ranging from Rs 5 lakh to 10 lakh can be taxed at 20%. It is possible to reduce income from 30% to 25% on income above Rs 1 lakh. Option to reduce cess and surcharge is also being considered. At the same time, some tax exemption options may be deducted.

Those with an income of Rs 10 lakh will get a benefit of 45 thousand

  • Up to 5 lakh income                                                  tax free
  • Standard deduction                                                   50 thousand rupees
  • Currently 20% tax on the remaining 4.5 lakhs         90 thousand rupees
  • The tax was reduced from 20% to 10%                    Rs 45,000
  • Savings                                                                      45 thousand rupees

Task Force Suggests 35% Tax on Income Over Rs 2 Crore: Report

According to a report by the English newspaper Hindustan Times, the government will take into account the suggestion of the task force on the direct tax code when making a decision. The task force submitted the report to the government a few days ago. According to another report, the task force has proposed to reduce the tax on income from Rs 5 lakh to Rs 1 lakh by 20% instead of 10%, instead of 30% at 10 lakh to 20 lakh and 30 percent on income above Rs 20 lakh. A tax of 35% was suggested on an income taxpayer of more than Rs 2 crore.

Current Rate of Income (Assessment Year 2019-20)

  • Income                          Tax
  • 2.5 lakhs rupees              0
  • 2.5 lakh to 5 lacs            5%
  • 5 million to 10 million   20%
  • over 10 million               30%

Full exemption through rebate in taxes on income up to Rs 5 lakh

In the interim budget introduced in February, the government announced a full tax exemption through rebate on taxable income of up to Rs 5 lakh. That is, it is necessary to file a return if there is such an income, but the tax will be exempt. This exemption will be available at the time of filing a return for the current minor year 2019-20 (Assessment Year 2020-21).

The government also reduced corporate tax last month

It is being said that the government may announce a reduction in Income Tax to accelerate economic growth. It will save people and it will cost more and slow the economy. The government announced last month to reduce corporate tax for domestic companies from 30 percent to 22 percent. However, companies are not required to take any other concessions.

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