Tax Highlights of Budget 2017-18

Following are the highlights for Tax and Income Tax: 

Personal Income Tax

1. Existing rate of tax for individuals between Rs.  2.5- Rs 5 lakh reduced to 5% from 10%
2. All other categories of tax payers in subsequent brackets will get benefit of Rs 12,500.
3. Simple one page return for people with annual income of Rs. 5 lakh other than business income.
4. People filing I-T returns for the first time will not come under govt. scrutiny.
5. 10% surcharge on individual income above Rs. 50 lakh and up to Rs 1 crore to make up for Rs 15,000 crore loss due to cut in personal I-T rate. 15 surcharge on individual income above Rs. 1 crore to remain.

Tax Proposals

1. India’s tax to GDP ratio is not favourable.
2. Out of 13.14 lakh registered companies, only 5.97 lakh companies have filed returns for 2016-17.
3. Proportion of direct tax to indirect tax is not optimal.
4. 1.95 crore individuals showed income between Rs 2.5 lakh to Rs 5 lakh.
5. Out of 76 lakh individual assessees declaring income more than Rs 5 lakh, 56 lakh are salaried.
6. Only 1.72 lakh people showed income of more than Rs 50 lakh a year.
7. Between Nov 8 to Dec 30: Deposits between Rs 2 lakh and Rs 80 lakh was made in 1.09 crore accounts.
8. Net tax revenue of 2013-14 was Rs 11.38 lakh crore.
9. Out of 76 lakh individual assessees declaring income more than Rs 5 lakh, 56 lakh are salaried.
10. 1.95 crore individuals showed income between Rs 2.5 lakh to Rs 5 lakh.
11. Rate of growth of advance tax in Personal I-T is 34.8% in last three quarters of this financial year.
12. Holding period for long term capital gain lowered to 2 years
13. Propose to have carry-forward of MAT for 15 years.
14. Capital gains tax to be exempted for persons holding land from which land was pooled for creation of state capital of Telangana.
15. Corporate tax: In order to make MSME companies more viable, propose to reduce tax for small companies of turnover of up to Rs 50 crore to 25%. About 67 lakh companies fall in this category. 96% of companies to get this benefit.
16. Propose to reduce basic customs duty for LNG to 2.5% from 5%
17. SIT on black money suggested no cash transactions of more than Rs 3 lakh. Govt has accepted this proposal.
18. Income Tax Act to be amended.  No transaction above Rs 3 lakh to be permitted in cash.
19. Limit of cash donation by charitable trust reduced to Rs 2,000 from Rs 10,000.
20. Net revenue loss in direct tax could be Rs. 20,000 crore.

Source: TheHindu.com