Union Cabinet approved a proposed Direct Tax Code (DTC) on Thursday and now it will be sent to Standing Committee’s review. It would be presented in the parliament on Monday. The proposal has a plenty of changes to the existing structure. The exemption limit for the individual general category to be raised to 2 L from 1.6 L, and there are changes to the slabs. However, it is said that the exemptions under section 80 (c) etc would be terminated.
Also there would be exemptions of surcharge and cess on corporate taxes and the tax rate would come down to 30 % from the existing 33%. All the changes would be displayed on finance ministry’s site once they have been introduced in the Parliament.
Union finance minister Pranab Mukherjee said “The whole objective is that a plethora of exemptions will be limited. Tax slabs will be three. Rate of taxes will be taken in the schedule so that they need not be changed every year”.
The below tables give you the details of existing and proposed tax slabs.
Existing slab | Proposed slab | Income Tax |
0-1.6 | 0-2 | Nill |
1.6 – 5 | 2-5 | 10% |
5 – 8 | 5 – 10 | 20% |
Above 8 | Above 10 | 30% |
Existing slab | Proposed slab | Income Tax |
0-1.9 | 0-2.5 | Nill |
1.9 – 5 | 2.5-5 | 10% |
5 – 8 | 5 – 10 | 20% |
Above 8 | Above 10 | 30% |
Existing slab | Proposed slab | Income Tax |
0-2.4 | 0-2.5 | Nill |
2.4 – 5 | 2.5-5 | 10% |
5 – 8 | 5 – 10 | 20% |
Above 8 | Above 10 | 30% |
Please refer to the below post for income tax slabs FY 2011 – 2012
Income Tax Slabs Fy 2011- 2012
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Sathish Emmadi
Sathish Emmadi is a co-founder & editor at Lastbull.com. He is presently working in IT for one of the world’s top mutual fund companies. Handled multiple projects in BFSI (Banking,Financial Services and Insurance) domain. An Engineering Graduate from NITW.
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{ 9 comments… read them below or add one }
Its a bold move by the government to reduce the tax slabs. More money in the hands of people means more growth.
Good thing about the tax slabs is the reduction in the number of slabs that makes the slabs simple, and a breeze to fill in..
I think Tax salb should be more flexible for salary calss And also think about the exemption limit of Conveyance that is 800 P.M.. It should be increased. We always focus on Tax slab only not think for this.. The price of petrol/diesel is continuously hiking but no one think .
WHAT WILL BE THE INCOME TAX SLAB FOR 2011-2012 AND ITS EXEMPTION LIMITS PLEASE SEND BY EMAIL SIR.
I will hardly call it a bold move. This is uselese move. Saving 2000 rs per month in the hand of people is not going to make hell lot of difference in the economy. It’s less than 1 Rs per day saving for people who pay taxes.
The bold move should have been on infra, Governance, corruption, and opening up of economy but the FM did not do anything except passing some urdu couplets.
The slabs given in this article were proposed last year. Please refer to the below one for FY 2011 – 2012 income tax slabs.
http://lastbull.com/income-tax-new-slabs-%E2%80%93-fy-2011-%E2%80%93-2012/
Pankaj, Completely agree with you. Not much to cheer with the budget for common man.
Right Sathish
In fact, inflation of 10% itself will require any person to increase the slab to 1.6 (1+ 10%) = 1.76 Lakh. The real increment is about Rs 4000 and if you take how much to save, it is Rs 400 an year which is about a rupee a day.
Wings Income Tax Booklet (F/Y 2011-2012) assessment year 2012-13