New Delhi, Feb 26 (Calcutta Tube) Finance Minister Pranab Mukherjee Friday gave relief to individual tax payers by raising personal tax slabs while introducing a simpler format of filing tax returns from the next assessment year.
Mukherjee proposed the following slabs for individual tax payers: No tax for annual income up to Rs.160,000, a rate of 10 percent between Rs.160,001 and Rs.500,000, 20 percent between Rs.500,001 and Rs.800,000 and 30 percent for income higher than Rs.800,000 per year.
‘The proposal to raise the tax slabs will benefit 60 percent of all tax payers,’ said Mukherjee.
The budget for 2010-11 also proposes to allow a deduction of up to Rs.20,000 for investments in long-term infrastructure bonds. The deduction would be in addition to Rs.100,000 allowed under section 80C of the Income Tax Act.
The government will also introduce Saral 2 – a simpler format of filing tax returns – from the next assessment year. Salaried tax payers currently use Income Tax Return-1 forms to file returns.