The Finance Minister has presented his third budget in parliament toady containing various direct and indirect tax proposals. In this article I intend to discuss some of the proposals which are beneficial to individual tax payers. Please note that at present these are only proposal until are passed by the parliament.
1. Increase in tax rebate for small tax payers
Presently a tax payer whose taxable income does not exceed Rs. 5 lakh is entitled to a reduction in his tax liability upto Rs. 2,000/-. Since the government is under pressure to increase the tax base, it did not want to increase the exemption limit so in stead it has decided to give relief to small tax payers by increasing the present of tax rebate under section 87 A to Rs. 5,000/- thus resulting in a saving of Rs. 3,000/- per year for small tax payers.