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Sinha keeps direct tax rates untouched, imposes 5% surcharge

The government on Thursday targeted to mop up additional Rs 60 billion mainly through withdrawal of various direct tax exemptions and imposition of a 5.0 per cent surcharge in the next fiscal.

In his Budget for 2002-03, Finance Minister Yashwant Sinha said the direct tax proposals would result in revenue gain of Rs 60 billion including the surcharge of Rs 27.50 billion, to mop up a total Rs 915.85 billion next fiscal.

Personal Income Tax rates remained unchanged at 10, 20 and 30 per cent.

While lifting the Gujarat surcharge of 2.0 per cent, Sinha imposed a 5.0 per cent surcharge across the board except those having income upto Rs 60,000 annually.

The government targets to raise Rs 425.24 billion from Income Tax next fiscal as against the estimated Rs 344.38 billion mopped up this fiscal.

Although Sinha kept Corporate Tax rate unchanged at 35 per cent, he slashed the tax rate on foreign companies to 40 per cent from the present 48 per cent.

The government, however, allowed additional depreciation at the rate of 15 per cent on new plants and machinery for setting up new industrial units or for expanding the installed capacity of the existing unit.

Corporate tax collections have been targeted at Rs 486.16 billion next fiscal as against the revised estimate of Rs 390.59 billion in the current fiscal.

Sinha also exempted the SSI sector from tax on investment in bonds issued by SIDBI.

Shipping industry has been exempted from the minimum alternate tax.

PTI

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