In a sign of relief for the people in the lower brackets of income tax, Finance Minister Arun Jaitley today announced reduction in the existing rate of taxation for individuals with income between 2.5 lakh to five lakh to five percent instead of 10 percent with an additional benefit of Rs. 12,500 for tax payers even beyond Rs. five lakh.
He further announced a surcharge of 10 percent for those who have an annual income of Rs, 50 lakh to one crore.
Jaitley while reading out his Union Budget for 2017-18 also announced tax rebate of Rs. 12,500 for those in the tax bracket of Rs. 50 lakh.
"We are committed to make our taxation rate reasonable with an effort for tax administration more fair, which expands the tax base of the country," added Jaitley.
In his speech, Jaitley said that the predominance of cash in our economy makes it easy for people to avoid taxes.
"We are largely a tax non compliance society, when too many people evade taxes burden falls on those who are honest," Jaitley said.
"3.7 crore individuals filed tax returns, 99 lakh of them below taxable limit. Number of people with more than 50 lakh income is 1.26 lakh," he said while mentioning the rate of growth in advance tax in personal income tax domains, which has increased by 34.81 percent," he added.
"Deposits between Rs. 2-80 lakh made in 1.09 crore accounts post demonetisation," he announced ending all speculations hovering over the exact data.