The much expected Income tax relief for Individual Tax payers was not considered in the Interim Budget as there was no proposal to change the Personal Income Tax Structure for the financial year 2009-10
“Constitutional propriety requires that (the) new government formulates the tax and expenditure policies for 2009-10…,” Finance Minister Mr. Pranab Mukherjee said in his interim budget speech.
Mukherjee introduced in the Lok Sabha the Finance Bill, 2009, which seeks to “continue the existing rates of income tax for the financial year 2009-10”.
Thus, those earning between Rs 1,50,001 and 3,00,000 a year will continue to pay 10 per cent income tax. The I-T rate remains 20 per cent for those earning between Rs 3,00,001 and 5,00,000 and 30 per cent on income above Rs 5,00,000.
The exemption threshold for women assessees remains unchanged at Rs 1,80,000 and Rs 2,25,000 for senior citizens.
Some of the corporate bodies had demanded increasing the income tax exemption limit to boost personal expenditure so that the economy, reeling under the slowdown, gets a stimulus.
There were hopes of the government changing tax rates in these difficult economic conditions, even though it was a vote-on-account seeking Parliamentary approval for state spending for the first four months of the next fiscal.
News Source : NDTV Profit