The Union Budget 2017 was a budget focused on providing the relief to the middle-class individual taxpayers. Let’s see what Arun Jaitley’s Union Budget 2017 had for the individuals.
1. Zero Tax Liability:
Arun Jaitley announced zero tax liability on the individuals earning an income up to Rs.3 Lakhs [after taking advantage of rebate u/s 87A].
2. Reduction in slab Rate:
The existing slab rate of 10% reduced to 5% for the individuals earning income from Rs.2.5 Lakhs- Rs.5 Lakhs.
3. Change in The Rebate u/s 87A:
The existing rebate under section 87A is reduced to Rs.2500 for individuals earning income up to Rs.3.5 Lakhs.
4. No Tax Up to income of Rs 4.5 Lakhs:
Arun Jaitley in his speech mentioned no tax liability for people earning income up to 4.5 Lakhs
(Exemption amount = 2.5 lakh + Deductions u/s 80C = 1.5 lakh + Rebate u/s 87A on the Tax Liability =Rs.2500 )
5. Capital Gains Amendments:
- For calculation of Long Term capital Gains-
The holding period for land & building will be reduced to 2 yrs from 3 yrs.
- Base year indexation shifted from 1.4.1981 to 1.4.2001 (From Cost Inflation Index 100 to 426)
6. Surcharge Introduced:
Earlier only 15% surcharge was applicable on income exceeding Rs. 1cr. Now 10 % surcharge is also applicable on income above Rs 50 lakh and up to Rs 1 cr.
7. Simple ITR Form:
The introduction of simple one -page return form for individuals having income up to Rs.5 Lakhs.
8. No TDS for Insurance Commission Agents:
Exemption from the TDS @5% to the insurance agents submitting a declaration of earning income below taxable limit.
9. Cash Donations:
The limit of donations in cash to charitable institutions reduced from Rs 10000 to Rs.2000.
10. No cash Transactions:
Transactions exceeding Rs 3 lakh will not be permitted in cash.
All the above changes shall be applicable from F.Y.2017-18.
Source: Live Budget Updates