No tax liability if your income is up to Rs 9.5 lakh, but conditions apply
New Delhi: Stressing that tax concessions have been provided with a view to help poor and middle-class people living on a tight budget, Finance Minister Piyush Goyal said that now individuals earning up to Rs 9.5 lakh can escape liability by taking advantage of saving schemes.
Replying to the debate on the Finance Bill in Lok Sabha, the Minister said he did not propose any change in the tax rate but only provided few rebates which will boost spending and help the economy.
The Finance Bill, which contains tax proposals, was passed by the Lok Sabha with a voice vote, completing the budgetary process in the lower house.
In a swipe at the Congress, the Minister said that unlike the previous UPA dispensation, the present Modi government in the interim budget did not reduce levies of SUVs which are used by rich persons.
In the Finance Bill 2019, the Minister proposed to raise tax rebate for people having annual income up to Rs 5 lakh from Rs 2,500 to Rs 12,500, which will effectively ensure that they don’t have to pay any tax.
In the Bill, standard deduction has also been raised from Rs 40,000 to Rs 50,000, besides a host of tax benefits to home buyers.
The concessions proposed in the Finance Bill, Goyal said, are aimed at helping “poor and middle-class people living on a tight budget…This is interim budget. We have not brought any tax proposal…we will bring them in July,” he said.
The next government, which will be formed after the upcoming general elections, will come out with a full budget in July. The next government will also come up with a Finance Bill containing the tax proposals for 2019-20.
The Minister said that if the Congress and other opposition parties had objections on the government giving a rebate to middle-class taxpayers and announcing income scheme for farmers, they should write in their election manifesto their intention to reduce tax exemption limit and withdrawing the farmer income scheme after coming into power.
Goyal was responding to the issues raised by certain members as to why the government announced concessions in the interim budget, ahead of the general elections.
Elaborating on his tax proposals, Goyal said that the decision to raise the rebate for people having an annual income of Rs 5 lakhs was to provide greater certainty about tax liability as salary payments to them is subject to Tax Deduction at Source (TDS).