Budget 2018-19 Income Tax Relaxation Highlights | Income Tax Relaxation in Budget 2018-19

Income Tax Relaxation & Budget Highlights

  1. Flagship National Healthcare Protection Scheme is introduced with approximately 50 crore beneficiaries. 10 cr families will be provided up to Rs 5 lakh per family per year for treatment and hospitalisation. It is World's Largest Government Funded Healthcare Programme.
  2. 1 cr houses to be built under Pradhan Mantri Awas Yojana in rural areas.
  3. Free power connections to 4 crore homes under Saubhagya Yojana.
  4. Under Swachh Bharat Mission, Centre plans to construct 2 crore more toilets.
  5. Kisan credit card facility extended to fisheries and animal husbandry sectors.
  6. 99 cities selected for smart cities project with an outlay of Rs 2.04 lakh crore.
  7. Government to establish a dedicated affordable housing fund under National Housing Bank for priority sector lending.
  8. Government to launch Prime Minister's Research Fellow Scheme which will identify 1000 B.Tech students to do Ph.D at IITs.
  9. Government to implement minimum support price for all crops. It is hiked to 1.5 times of production costs.
  10. Government to expand capacity of airports by five times to cater to one billion trips a year.
  11. Fiscal deficit for 2017-18 raised to 3.5% of GDP as against 3.2% previously estimated and for FY 19 deficit pegged at 3.3% as against 3% targeted previously.
  12. Disinvestment target for this year set at Rs.80,000 crore.
  13. There is no change in Personal Income Tax Rates.
  14. Increase in education and health cess on personal income tax and corporation tax from 3% to 4 %.
  15. Salaried Tax Payers will get a standard deduction of Rs.40,000 in lieu of exemption for transport allowance and reimbursement of miscellaneous medical expenses.
  16. Exemption of interest income to Senior Citizens on deposits with banks and post offices to be increased from Rs 10,000 to Rs 50,000. TDS not to be deducted on such income under section 194A.
  17. Increase in deduction limit under section 80D from Rs 30,000 to Rs 50,000 for health insurance premium and/or medical expenditure.
  18. Increase in deduction limit under section 80DDB for medical expenditure for certain critical illness from Rs 60,000 to Rs 1 lakh(in case of senior citizens) and from Rs 80,000 to Rs 1 lakh(in case of very senior citizens) .
  19. Government will contribute 12% of the wages of new employees in EPF in all sectors for next 3 years. Women contribution to EPF reduced to 8% for first 3 years.
  20. Employees PF Act to be amended to reduce contribution of women to 8 pc from 12 pc with no change in employer's contribution
  21. Reduction in tax rate from 30% to 25%, which is currently available to companies with turnover of less than 50 crore (in Financial Year 2015-16), to companies reporting turnover up to Rs. 250 crore in Financial Year 2016-17.
  22. Tax on Long Term Capital Gains (LTCG) exceeding Rs 1 lakh at the rate of 10%, without allowing any indexation benefit. However, all gains up to 31st January, 2018 will be grandfathered. Short Term Capital Tax (STCG) to continue at 15%
  23. Introduction of tax on distributed income by equity oriented mutual funds at the rate of 10%.
  24. Surcharge of 10% on income above Rs 50 lakh but less than Rs 1 cr and Surcharge of 15% on income above Rs 1 cr to continue.
  25. PAN becomes mandatory for any entity entering into a financial transaction of Rs 2.5 lakh or more.
  26. PAN to be used as Unique Entity Number for non-individuals from Apr 1, 2018.
  27. Government to take additional measures to strengthen environment for Venture Capitalists and Angel Investors.
  28. Recapitalisation will pave the way for Public Sector Banks to lend an additional Rs 5 lakh crore.
  29. Emoluments for President set at Rs 5 lakhs, for Vice President at Rs 4 lakhs and for governors at Rs 3.5 lakhs. Automatic revision of emoluments parliamentarians every five years, pegged to inflation.