In the major step, Finance Minister Arun Jaitley announced various changes in the Tax, that includes reduction of individual tax. Many more changes have been made in the current budget 2017 and the consolidated report of the Tax Budget 2017 is as follows.
For the better understanding, the pointers are there of the budget 2017:
- The tax rate reduced to 5% on Rs. 2.5 Lakh to 5 Lakh
Finance minister Arun Jaitley, last day sought to remedy that by reducing the base tax rate to 5 percent from the earlier 10 percent on income of between Rs 2.5 lakh to Rs 5 lakh.
For Income Tax Return Slab:
- Rebate under section 87A :
Rebate under section 87A of the Income-tax Act, 1961 (“the Act”) is proposed to be reduced from Rs 5,000 to Rs 2,500. It has also been proposed to restrict such rebate to resident individuals whose total income does not exceed Rs 350,000 (earlier Rs 500,000).
- Partial Exemption for Pension:
The existing provision of section 10(12A) of the Act provides that payment from National Pension System (“NPS”) trust to an employee on closure of his account or opting out shall be exempt up to 40% of total amount payable to him.
- Rationalization of deduction under section 80CCD for self-employed individual:
In order to bring about parity between an individual who is an employee and an individual who is self-employed, it is proposed to amend section 80CCD of the Act so as to increase the upper limit of 10% of Gross Total Income (“GTI”) to 20% in case of individual who is self-employed.
- Reduction of holding period for computation of capital gains for immovable property:
It is proposed to amend section 2(42A) of the Act to reduce the holding period from existing 36 months to 24 months in case of immovable property being land and building or both to quality as long term capital asset.
- Service tax on e-tickets booked online through IRCTC:
Finance Minister has been announced in budget for 2017-2018. Currently, Rs 20 is levied as service tax on Sleeper and Rs 40 on AC classes for booking tickets through IRCTC. The service charge levied on each ticket was not refundable in case of a cancellation and if booking has not confirmed by IRCTC so the service charge was refundable on each ticket.
- Improve Infrastructure:
Arun Jaitley has announced in budget but it is not like opening the can of worms but it was a happy budget for everyone. They will improve infrastructure and railways sector.