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InDepth

provide additional tax benefit of 4,700 required to pay any income tax if they efit small depositors and non-working
crore to more than 3 crore salary earn- make investments in provident funds, spouses”. Further, the TDS threshold
ers and pensioners. Exemption on levy specified savings, insurance etc. In for deduction of tax on rent has also
of income tax on notional rent on a fact, with additional deductions such been proposed to be increased from
second self-occupied house is also now as interest on home loan up to 2 lakh, 1,80,000 to 2,40,000 for providing
proposed. Currently, income tax on interest on education loans, National relief to small taxpayers.
notional rent is payable if one has more Pension Scheme contributions, medi- TDS threshold on interest earned
than one self-occupied house. cal insurance, medical expenditure on bank/post office deposits is being
Individual taxpayers having taxable on senior citizens etc, persons having raised from 10, 000 to 40, 000. The
annual income up to 5 lakhs will get even higher income will not have to TDS threshold for deduction of tax on
full tax rebate and therefore will not be pay any tax. This will provide tax ben- rent is proposed to be increased from
required to pay any income tax. While efit of 18,500 crore to an estimated 1, 80,000 to 2, 40, 000 for providing
presenting the Interim Budget 2019-20 3 crore middle class taxpayers compris- relief to small taxpayers.
in Parliament today the Union Minister ing self employed, small business, small The finance minister says that the
for Finance, Corporate Affairs, Railways traders, salary earners, pensioners and government wants the GST burden on
& Coal, Shri Piyush Goyal said “Because senior citizens. home buyers to be reduced and accord-
of major tax reforms undertaken by For salaried persons, Standard ingly the GST Council was moved to ap-
us during last four and half years, both Deduction is being raised from the point a Group of Ministers to examine
tax collections as well as tax base have current 40,000 to 50,000. “This will and make recommendations in this
shown significant increase, achieving provide additional tax benefit of 4,700 regard at the earliest. Goyal said that
a moderate taxation- high compliance crore to more than 3 crore salary earn- soon, businesses comprising over 90
regime. It is, therefore, just and fair that ers and pensioners”, the Finance Minis- per cent of GST payers will be allowed
some benefits from the tax reforms ter informed. to file quarterly return.
must also be passed on to the middle Tax Deduction at Source (TDS)
class taxpayers”. threshold on interest earned on bank/ Relief to house owners
As a result, the Finance Minister post office deposits has been pro- It has been proposed to exempt the levy
added that even persons having gross posed to be raised from 10,000 to of income tax on notional rent on a
income up to 6.50 lakhs may not be 40,000. Shri Goyal said, “This will ben- second self-occupied house. Currently,
income tax on notional rent is payable
if one has more than one self-occupied
house. Goyal announced the relief
considering the difficulty of the mid-
dle class having to maintain families at
two locations on account of their job,
children’s education, care of parents
etc. Further, the Finance Minister pro-
posed to increase the benefit of rollover
of capital gains under Section 54 of the
Income Tax Act from investment in one
residential house to two residential
houses for a taxpayer having capital
gains up to 2 crore. This benefit can be
availed once in a life time. For making
more homes available under afford-
able housing, the benefits under Sec-
tion 80-IBA of the Income Tax Act is be-
ing extended for one more year, i.e., to
the housing projects approved till 31st
March, 2020. Also, for giving impetus to
the real estate sector, the Finance Min-
ister proposed to extend the period of
exemption from levy of tax on notional
rent, on unsold inventories, from one
year to two years, from the end of the
year in which the project is completed.

Tehelka / 28 february 2019 20 www.Tehelka.com