With the coming budget on July 5 this year, we could witness an increase in income tax limit from 2.5 lakh to 5 lakh as suggested from ASSOCHAM. Also, the ruling government is considering to imply tax on cash withdrawal of above INR 10 lakh in a year. It will not only help in promoting digital transactions but also reduce the use of paper money and put restraints on the black money.
Indian industry has demanded from the government to increase income tax limit from 2.5 lakh to 5 lakh. Lately, Industry body ASSOCHAM and earlier the Confederation of Indian Industry (CII) has demanded to double the exemption limit of income tax in the budget.
Not even this, the Industry Board also suggested that standard deduction (standard deduction) should be brought up to INR 1 lakh for required legality between the salaried and non-salaried taxpayers. All in all, it should be close to 20 per cent standard deduction of gross salary which will calculate up to INR 1 lakh. And it is required because the salaried people have to pay more.
Read Also: Income Tax Authorities Sends Notices For Cash Transactions Exceeding Rs. 5 Lakhs
While for the tax levied on people who have received cash of INR 10 lakh per year, as per the government sources AADHAAR certification for the cash withdrawals to be mandatory. It will not only help in identifying people with a high amount of withdrawals and match their tax return. Other than this, UID certification and OTP will ensure that the Aadhaar number is not misused.
However, as of now, both things are suggested to the government to bring into consideration. However, the budget showcased on July 5 will tell that these aspects are included in it or not.
