The government proposes no change in personal income tax rates for salaried class. Jaitley said in his speech that there has been a 12.6% growth in direct taxes in 2017-18; 18.7% growth in indirect taxes in 2017-18. As many as 85.51 lakh new taxpayers filed their tax returns in 2017-18, as against 66.26 lakhs in 2016-17. The number has increased from 6.47 crore in 2016-17 to 8.27 crore by end of 2017.
Some of the key highlights are:
- Surcharge of 10% on income above Rs 50 lakh but less than Rs 1 cr to be continued next year; 15% on income above Rs 1 cr to also continue.
- 100% tax deduction is allowed to co-operative societies.
- Corporate Tax of 25% extended to companies with turnover up to Rs 250 cr in financial year 2016-17.
- Incentives for Senior citizens: Exemptions in income of Rs 10,000 from Banks FD and post offices.
- Senior citizens to get Rs 50,000 per annum exemption for medical insurance under Sec 80D.
- Rs 7.5 lakh per senior citizen limit for investment in interest-bearing LIC schemes doubled to Rs 15 lakh
- Standard deduction of Rs 40,000 allowed for transport, medical reimbursement for salaried tax payers
- Govt to reduce hardships faced in realty deals; no adjustment to be made in case circle rate does not exceed 5 pc of sale consideration.
- Rs 8,000 crore revenue lost due to standard deduction al l owed to salaried employees.
- Govt makes PAN mandatory for any entity entering into a financial transaction of Rs 2.5 lakh or more.