The Cabinet on Thursday approved the draft of the Direct Tax Code (DTC) Bill
The new provisions under the Direct Tax Code are as follows:
- Tax for income between Rs. 2 lakh â€“ Rs. 5 lakh: 10%
- Tax for income between Rs. 5 lakh â€“ Rs. 10 lakh: 20%
- Tax for income over Rs. 10 lakh: 30%
For women and senior citizens, the exemption limit would be Rs 2.5 lakh per annum. At present, women have to pay tax on incomes of Rs 1.9 lakh per annum or more and senior citizens on incomes of Rs 2.4 lakh or more.
orporate tax has been kept at 30%.
On the plus side for individual taxpayers, withdrawal from provident funds will not be taxed as the original DTC had proposed to do. Also deductions from taxable income will be available for interest on housing loans up to Rs 1.5 lakh per annum and on payments into PF and similar superannuation schemes up to Rs 1 lakh. Also available will be a deduction of up to Rs 50,000 for life insurance and health insurance premiums or tuition fees.
The new Code comes into effect from April, 2011. reports toi
In summary You will in fact have to pay less.
highlights Direct Tax code. direct tax code 2011
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