I-T exemption limit raised to Rs 100,000

Finance Minister P Chidambaram has some good news for the salaried class. He has raised the exemption limit on Income Tax raised to Rs 1 lakh (Rs 100,000), meaning anyone earning up to Rs 100,000 per year will not have to pay any Income Tax.

• The finance minister has, however, not made any changes in the tax slabs.
• Chidambaram said that everyone will file tax returns and anyone with an annual income of Rs 100,000 will have his tax automatically rebated.
• This will take 1.4 crore tax assessees out of I-T net.
• Government remained committed to moderation and stability in tax rates, Finance Minister P Chidambaram said.
• Family pension for widows of armed forces and para-military forces killed in operations are exempted from income tax.
• 100 beds hospital in rural areas to get 100 % tax  exemption under 80 I B.
• Section 80(DD) and Section 80 (U) will be given to persons suffering from autism, cerebral palsy and multiple disability.
• Contributions to Contributory Pension Scheme exempted form tax. Terminal Tax to be paid at the time of receipt.
• Loopholes in gift tax exemption to be plugged.
• Encouragement to automobile sector. Industry to be provided 150 per cent exemption for in-house research and development.
• Capital Gains Tax revamped on securities. Long term capital gains tax abolished.
• Tonnage tax introduced for shipping industry but will have option to pay either tonnage tax or corporate tax.