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Prime Minister Narendra Modi can play 'master stroke' by increase income tax exemption limit

Thursday - January 10, 2019 1:29 pm , Category : WTN SPECIAL
Demand for tax exemption limit of Rs 5 lakh
Demand for tax exemption limit of Rs 5 lakh

Hope on the general budget going to be presented on 1st February 

JAN 10 (WTN) - The Modi government is going to present its last budget on February 1. Prior to the budget, Prime Minister Modi has done his best to please the businessmen, farmers and the middle class salaried people. Everyone has a lot of hope from this budget of the Modi government, which will be presented before the Lok Sabha elections. In this connection, the CII (Confederation of Indian Industry) has asked the Modi government to double the limit of income tax exemption limit in the general budget from 2.5 lakh to five lakh rupees.

With this, CII has also demanded to increase the limit of deduction under Section 80C to Rs 2.50 lakh to encourage savings. According to information received from the media, CII has suggested in its pre budget recommendations to the Finance Ministry that the highest slab of personal income tax should also be reduced from 30 percent to 25 percent. At the same time, CII demands that medical expenditure and transport allowances should also be given income tax exemption.

For your information, let you know that at present the limit of personal income tax exemption is 2.5 lakhs. While the income tax on 2.5 lakh to five lakh rupees income is 5 per cent. At the same time, the tax on income of 5 to 10 lakhs is 20 percent and tax on income of more than Rs 10 lakh is 30 per cent. 

CII has suggested to the government that income up to Rs 5 lakh should be tax-free. Apart from this, tax on income of 5 to 10 lakh should be reduced and it should be 10% as well as tax on income of Rs 10-20 lakh should be 20% and there should be 25 per cent income tax on the income of more than Rs.20 lakh.

As you know, due to the Lok Sabha elections, the Modi government is presenting the interim budget and the new government to be formed after the election will present the full budget. CII also suggested that the rate of corporate tax should be reduced to 25 per cent for all companies. Later, it should be brought down gradually to 18 per cent.

CII has also suggested to the government that the tax deduction limit under section 80C of the Income Tax Act should be increased from Rs 1.50 lakh to Rs 2.50 lakh. At the same time, the CII has said that the relaxation of medical expenses and reimbursement of transport allowance should be revived and along with the standard deduction of Rs 40,000 should also be applied.

If the Modi government accepts the demand of the CII in the election year, it can be said that a lot of benefits can be received by the NDA and especially the BJP. Because for a long time, there has been the income tax exemption demand. In such a situation, if Modi Government fulfills the demand of the people, then this gift will be given to the general public of the country by Prime Minister Narendra Modi. If Prime Minister Modi increased the limit of income tax exemption before the Lok Sabha elections, it would be his master stroke, which would not have any answers to the opposition.