New Delhi, Feb 26 (ANI): Union Finance Minister Pranab Mukherjee on Friday announced the increase in tax slabs, and said tax on income up to Rs 1.6 lakh would be nil.
Delivering budget speech in the Lok Sabha, Mukherjee said tax on income up to Rs 1.6 lakh would be nil, above Rs 1.6 lakh to Rs 5 lakh would be 10 percent, above Rs 5 lakh to 8 lakh would be twenty percent and above Rs 8 lakh to be 30 percent.
Mukherjee also announced that over and above Rs 1 lakh deduction on tax savings, an additional deduction of 20 percent for investment in long-term infrastructure bonds would be allowed.
Minimum alternative tax (MAT) has been increased from 15 percent to 18 percent Direct tax concessions worth Rs 26,000 crore:, was another highlight of the Budget.
In his speech, Mukherjee indicated that cars would be costlier.
Mukherjee has introduced major reforms on direct and indirect taxes front in the form of Goods and Services Tax (GST) and Direct Taxes Code (DTC) from April 1, 2011.
"I am confident that the government will be in a position to implement Direct Taxes Code from April one, 2011... It will be my earnest endeavour to implement Goods and Services Tax along with DTC from April one, 2011," Mukherjee said.
This means that Goods and Services Tax would miss its earlier introduction deadline of April 1, 2010, by a year.
While Direct Taxes Code will replace the archaic Income Tax Act, Goods and Services Tax will replace most indirect taxes at central and states levels like service tax, excise duty, VAT, esses, surcharges and local levies. (ANI)