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Removal Of Surcharge...

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The abolition of the surcharge, which is levied on those with income above Rs 10 lakh a year, will result in a saving of Rs 25,000 for those with an income of Rs 11 lakh. And then the benefit increases with the addition of every lakh.

However, women with an income of Rs 11 lakh would save a little less at Rs 24,926 and senior citizens about Rs 24,978. The taxable slab for women is higher than general taxpayers while that of senior citizens is even more.

The higher tax benefits given in the tax exemption limits lead to a decline in the incremental benefit derived for a taxpayer.

Finance Minister Pranab Mukherjee, while presenting the Budget for 2009-10, said that the surcharge on direct taxes needs to be removed. "I propose to phase out the surcharge on various direct taxes by eliminating the surcharge of 10 per cent on personal income tax," Mukherjee said.

The move was welcomed by tax experts, who said that similar treatment should be given to all others including corporates.

"This is a move which paves the way for rationalisation of tax rates. Similar treatment should be given all including corporates," said tax law firm partner from Amarchand Mangaldas Aseem Chawla.



SARAL FORM TO RETURN



Scrapped three years back, the much talked-about simple tax form, Saral, is on its way back in a new avatar, making the task of filing tax returns easier.

"The Income Tax return forms should be simple and user friendly. I have asked the department to work on SARAL-II forms for early introduction," Finance Minister Pranab Mukherjee said today while unveiling the Budget 2009-10.

"It is time that we complete the process of building a trust-based simple, neutral tax system".

"We need a tax system which generates revenues on a sustained basis without use of coercive tax collection methods at the end of each year to meet the targets," Mukherjee said.

The simple, one-page Saral form was replaced by the form 2F from August 1, 2006, which was a four-page form.

After much opposition from various quarters, the government scrapped form 2F as well, replacing it with ITR forms, which can be accessed online. A Parliamentary Standing Committee had also dubbed form 2F as 'Kathin' (hard), asking for its replacement with Saral form.


(PTI)