The basic exemption limit of individual has not been raised from 2.5 lakhs to 5.00 lakhs. Instead section 87A has been amended and stated as :
If the net income is upto 5.00 lakhs after all deduction then only no tax will be charged. Otherwise the last year system will be followed
If the net income is upto 5.00 lakhs after all deduction then only no tax will be charged. Otherwise the last year system will be followed
*Bottom line*
If your income exceeds Rs. 5 Lakhs, you have to pay taxes for the first 5 lakhs also (i.e, 2.5 lakhs after basic exemption, which will work out to Rs.12500/-).
The same was highlighted by Piyush Goyal in his speech as well. *If an individual has income of ₹925,000* and invests ₹150,000 as per Sec 80C, ₹50,000 in new pension scheme, pays medical insurance premia of ₹25,000 and has a housing loan interest of ₹200,000, still *that person would not be required to pay any tax*.
The salaried class, only honest tax payers of the nation, have been left in the lurch by the BJP government. We, the middle class feel cheated and betrayed.
On the other hand, the threshold limit for presumptive tax payable by the small business persons and self employed professionals has been raised, inspite of documentary evidence showing that the average tax paid by these two groups is abysmally low and ludicruous.
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