The Lok Sabha cleared the Finance Bill 2019. In the Finance Bill 2019, the Minister proposed to raise tax rebate for people having annual income up to Rs 5 lakh from Rs 2,500 to Rs 12,500, which will effectively ensure that they don’t have to pay any tax. Those having income of up to Rs 8-9 lakh too can take advantage of this if they invest in tax saving schemes.
In the Bill, standard deduction has also been raised from Rs 40,000 to Rs 50,000,besides a host of tax benefits to home buyers.The tax proposals are aimed at helping “poor and middle class people living on tight budget”, Goyal said while moving the Finance Bill which contains tax proposals of the government.
The next government, which will be formed after the upcoming general elections, will come out with full budget in July. It will also come up with a Finance Bill containing the tax proposals for 2019-20.
Did You Know?
Direct taxes are paid in entirety by a taxpayer directly to the government. It is also defined as the tax where the liability as well as the burden to pay it resides on the same individual. Direct taxes are collected by the central government as well as state governments according to the type of tax levied. Major types of direct tax include:
- Income Tax: Levied on and paid by the same person according to tax brackets as defined by the income tax department.
- Corporate Tax: Paid by companies and corporations on their profits.
- Wealth Tax: Levied on the value of property that a person holds.
- Estate Duty: Paid by an individual in case of inheritance.
- Gift Tax: An individual receiving the taxable gift pays tax to the government.
- Fringe Benefit Tax: Paid by an employer that provides fringe benefits to employees, and is collected by the state government.