New Delhi, January 31: After the government cut the corporate tax rate three months ago, hopes are high that when Finance Minister Nirmala Sitharaman presents the Budget 2020 tomorrow will also revise personal income tax slabs that will spur major relief to taxpayers. Currently, only for individuals under 61 years of age earning an annual income of Rs 2.5 lakh is exempted from any taxes.
How should the government change this going forward, the survey conducted by an online forum, LocalCircles, asked. While 69 per cent respondents felt that this should be increased to Rs 5 lakhs, 18 per cent said it should be increased to Rs 3 lakh, 7 per cent said it should be kept at Rs 2.5 lakh, and only 4 per cent said it should be reduced to Rs 2 lakh instead.
In the current income tax slabs, there is zero tax levied for individuals earning an annual income up to Rs 2.5 lakh, while 5 per cent is levied for individuals earning between Rs 2.5 lakh to Rs 5 lakh, 20 per cent for individuals earning between Rs 5 lakh to Rs 10 lakh, and 30 per cent for individuals earning above Rs 10 lakh.
To a question on the survey that analysed more than 80,000 votes from over 44,000 participants asked what is the best way for the government to boost consumer spending, 28 per cent said just a tax rate cut across the board would do the trick, while 29 per cent said the government should provide a tax cut across the board and incentivise the taxpayer to spend it within a year.
To the same question, 13 per cent said a domestic tourism deduction of up to Rs 50,000 per year should be provided, 10 per cent said a deduction of upto Rs 25,000 per year should be provided on school or professional education, and 1 per cent said a deduction of Rs 50,000 should be given on purchase of an automobile.