Your personal income tax might get reduced if Ministry of Finance acts on a proposal, Tarun Sharma of Zee Business reports.
Sources told the reporter that the finance ministry has proposed that no tax will be liable up to the income worth Rs 4 lakh. Currently, no tax is charged up to income of Rs 2.5 lakh per year.
The impact of demonetisation is seen as a prime cause for the Government to give this rebate in income tax. Currently, nearly 4% of the total population of India files income tax.
Moreover, as per the proposal, the government likely to impose 10% tax on income between Rs 4 lakh to Rs 10 lakh in the new tax bracket. Currently, for the income exceeding Rs 2.5 lakh to Rs 5 lakh is liable for 10% tax.
For the income between Rs 10 lakh to Rs 15 lakh, the tax rate is likely to be 15% as per the new proposal. Presently, 20% is imposed on income between Rs 5 lakh to Rs 10 lakh.
Further, for the income between 15 lakh to Rs 20 lakh, 20% of tax will be charged. Currently, 30% tax rate is levied on income more than Rs 10 lakh.
Income tax for income over Rs 20 lakh may be fixed at 30%, the source said.