Budget 2019: Govt. plans to raise IT exemption limit to 5 lakhs

12 Crore Farmers to Get Rs 500 Per Month Directly in Bank Accounts

New Delhi, February 1: Standing in for Union Minister Mr. Arun Jaitley, Finance Minister Piyush Goyal said the government proposes to raise the income tax exemption limit to Rs 5 lakh but left the implementation to the next government.

The Finance Minister also proposed to raise the standard deduction for salaried employees from the current Rs 40,000 to Rs 50,000 and a full rebate for individual tax payers earning up to Rs 5 lakh per year.

The proposal will benefit 3 crore middle-class tax payers, Goyal said while unveiling the Budget proposals for 2019-20. Doubling the threshold exemption limit will increase the burden on the exchequer by Rs 18,500 crore.

“An estimated 3 crore tax payers are going to benefit from the proposed revision of the tax slabs,” Goyal said. This revised threshold is expected to put an extra burden of Rs 18,500 crore on the exchequer.

According to data, at least 3,53,88,404 individuals had filed declared income below Rs 5 lakh in 2017-18.

The Finance Minister also proposed to raise the standard deduction for salaried employees from the current Rs 40,000 to Rs 50,000 and a full rebate for individual tax payers earning up to Rs 5 lakh per year.

“Individual taxpayers having taxable annual income up to Rs 5 lakh will get full tax rebate and therefore will not be required to pay any income tax. For salaried persons, standard deduction is being raised from the current Rs 40,000 to Rs 50,000. This will provide additional tax benefit of Rs 4,700 crore to more than 3 crore salary earners and pensioners,” Goyal said in his speech.

“Reducing the tax burden on middle class has always been our priority ever since our Government took over in 2014,” Goyal added.

If an individual invests in the specified tax-saving schemes of the government, the effective tax-free income limit will be Rs 6.5 lakh a year, while it may go further up with additional avenues like NPS, medical insurance and home loan interest payment.

If an individual invests in the specified tax saving schemes of the government, the effective tax-free income limit will be Rs 6.5 lakh a year, while it may go further up with additional avenues like NPS, medical insurance and home loan interest payment.

In his budget speech on Friday Goyal also announced the plan of the government to provide an assisted income support to small and marginal farmers under the scheme Pradhan Mantri Kisan Samman Nidhi (PMKISAN).

Under the scheme a direct transfer of Rs 6,000 per year will be made to the bank accounts of farmers owning less than two hectares of land, Goyal told the parliament today.

“Farmers earlier did not get full cost for their produce. Farmers income has reduced over the years. Income support to farmers small and marginal farmers Pradhan Mantri Kisan Samman Nidhi (PM KISAN) has been approved. Famers having 2 hectares and less will be provided with Rs 6000 per annum directly into their accounts,” Goyal said.

The amount will be directly transferred to the accounts of farmers in three equal installments.

According to the Agriculture Survey, the small and marginal holdings taken together (0.00-2.00 hectare) constituted 86.21 per cent in 2015-16 against 84.97 per cent in 2010-11 while their share in the operated area stood 47.34 per cent in the current census as against 44.31 per cent in 2010-11.

The programme, the FM said, will be funded 100 per cent by the Central government and the government estimates 12 crore farmer families to be directly impacted by the scheme. The estimated expenditure under the scheme will come around Rs 75,000 crores every year completely borne by the Centre. Rs 20,000 crore will be spent in this financial year, Goyal claimed.

Earlier this week on Monday, Congress president Rahul Gandhi promised to implement a nationwide minimum income for the poor if the Congress is voted to power in May this year.

“Assured supplemental income would also meet their (farmers’) essential needs before the sowing season and would enable them to live a respectable life,” FM Goyal said in his speech.