Threshold limit of exemption from personal income tax in the case of all assesses increased to Rs.150,000.
The slabs and rates of tax are :
Up to Rs.150,000 NIL
Rs.150,001 to Rs.300,000 10 per cent
Rs.300,001 to Rs.500,000 20 per cent
Rs.500,001 and above 30 per cent
In case of a woman assessee, the threshold limit increased from Rs.145,000 to Rs.180,000
In case of senior citizens, the threshold limit increased from Rs.195,000 toRs.225,000
No change in the corporate income tax rates.
No change in the rate of surcharge.
Senior Citizen Saving Scheme 2004 and the Post Office Time Deposit Account added to the basket of saving instruments under Section 80C of the Income Tax Act.
Additional deduction of Rs.15,000 allowed under Section 80D to an individual paying medical insurance premium for his/her parent or parents.
Benefit of amortization of certain preliminary expenses under Section 35D allowed to assessee in the services sector. Corporate debt instruments issued in demat form and listed on recognized stock exchanges exempted from TDS.
Crèche facilities, sponsorship of an employee-sportsperson, organizing sports events for employees and guest houses excluded from the purview of FBT.
Parent company allowed to set off the dividend received from its subsidiary company against dividend distributed by the parent company provided that the dividend received has suffered DDT and the parent company is not a subsidiary of another company.
Insert a new sub-section (11C) in Section 80-IB to grant a five year tax holiday to hospitals located in any place outside the urban agglomerations especially in tier-2 and tier-3 towns; this window will be open for the period April 1, 2008 to March 31, 2013.
Five year holiday from income tax being granted to two, three or four star hotels established in specified districts having UNESCO-declared ‘World Heritage Sites’; the hotel should be constructed and start functioning during the period April 1, 2008 to March 31, 2013.
Rate of tax on short term capital gains under Section 111A & Section 115AD increased to 15 per cent.
STT paid to be treated like any other deductible expenditure against business income
Levy of STT, in the case of options to be only on premium, where the option is not exercised; liability to be on the seller; where the option is exercised, levy to be on the settlement price and the liability on the buyer; no change in the present rates.
Commodities Transaction Tax (CTT) to be introduced on the same lines as STT on options and futures.
Banking Cash Transaction Tax (BCTT) being withdrawn with effect fromApril 1, 2009.
CST
Central Sales Tax rate being reduced from 3 per cent to 2 per cent from April 1, 2008.
Indian Market News
Budget 2008, India Budget