Narendra Modi government is likely to increase the income tax slab to Rs. 4 lakh per annum from the current Rs. 2.5 lakh per annum. This move comes after the government pulled Rs. 500 and Rs. 1000 notes on November 8 and to ease the pain of citizens of India.
In a wake to curb counterfeits and black money which prevailing as parallel economy that is ruining India’s economy, as all illegible activities happen in underworld economy. The revises income tax proposal is expected to be implemented from the budget session 2017.
According to new income tax proposal, the tax will be levied based on Rs 4 lakh to 10 lakh may be taxed at 10% (the current slab is Rs. 2.5-5 lakh taxed at 10%); Rs 10-15 lakh will be taxed at 15% (currently Rs5-10 lakh is taxed at 20%); Rs 15-20 Lakh to be taxed at 20% (Currently Rs 10 lakh and above is taxed at 30%) and a slab where income above Rs 20 lakh will attract a tax of 30%.
If the reports were to be true, then its god news for fellow citizens which will increase the spending and cash flow among people which eventually will boost consumption and economy.
We have two types of taxes – direct and indirect tax. Income tax falls under direct tax and sale tax, excise and service tax comes under indirect tax. After demonetization indirect taxes have fallen by 20%.
Meanwhile, government spokesman Frank Noronha has rejected the report about new income tax slabs. He went on to term them as ‘baseless and unfounded’.
Here’s the proposed income tax slabs:
Revised Income Tax Slabs
|Slab (Rs Lakh)||Tax Rate (%)||Slab (Rs Lakh)||Tax Rate (%)|
|0-2.5||No Tax||0-4||No Tax|