Finance Minister Arun Jaitley today gave a significant tax break to a common man by cutting down the tax rates to 5 per cent on income between Rs 2.5 lakh to Rs 5 lakh.
For individuals with annual income of Rs 50 lak to Rs 1 crore, the Finance Minister imposed a surcharge of 10 per cent. The 15 per cent surcharge on incomes above Rs 1 crore will continue.
Jaitley also hinted at a proposal to allow a carry forward of Minimum Alternative Tax for a period of 15 years up from the current 10 years now.
While presenting the Budget 2017-18 in Lok Sabha, Jaitley revealed that in 2015-16, a total of 3.7 crore individuals filed for tax returns.
Amongst these 3.7 crore persons, as many as lakh had income below the exemption limit.
“Of 3.7 crore individuals who filed tax returns in 2015-16, 99 lakh showed income below exemption limit,” Jaitley said in his budget speech.
Further, he stressed on the differences between direct tax collection and income-expenditure pattern.
“Direct tax collection not commensurate with income and expenditure pattern,” Jaitley stated.