Budget 2011: Changes in income tax exemptions

NEW DELHI Mon Feb 28, 2011 3:25pm IST

Finance Minister Pranab Mukherjee arrives at the parliament to present the 2011/12 federal budget in New Delhi February 28, 2011. REUTERS/B Mathur

Finance Minister Pranab Mukherjee arrives at the parliament to present the 2011/12 federal budget in New Delhi February 28, 2011.

Credit: Reuters/B Mathur

NEW DELHI (Reuters) - In his budget for the coming financial year, Finance Minister Pranab Mukherjee on Monday announced raising the personal income tax exemption limit from 160,000 rupees to 180,000 rupees in FY2012.

“This measure will provide a uniform tax relief of 2,000 rupees to every taxpayer of this category,” Mukherjee said in his speech.

Mukherjee said he has limited his proposals to initiatives that require urgent attention, as the government's policy on direct taxes has been outlined in the DTC, which is before parliament.

“We were expecting around two lakh that is what the market speculation was, just raised about 20,000 which is hardly anything,” said Mohit Oberoi, a businessman.

The finance minister also extended 20,000 rupees exemption for investment in infra debt funds for another year.

Qualifying age for senior citizens will be reduced to 60 years from 65 years while the exemption limit will be increased from 2,40,000 rupees to 2,50,000 rupees, Mukherjee said.

The finance minister also proposed the creation of a new category of very senior citizens aged above 80 years, who will be eligible for a higher exemption limit of 5,00,000 rupees.

(Reporting by India Online)

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