Stressing that
tax concessions have been provided with a view to help poor and middle class people living on a tight budget, Finance Minister
Piyush Goyal on Tuesday said that now individuals earning up to Rs 9.5 lakh can escape liability by taking advantage of saving schemes.
Replying to the debate on the Finance Bill in Lok Sabha, the Minister
said he did not propose any
change in the tax rate but only provided few
rebates which will boost spending and help the economy.
The Finance Bill, which contains tax proposals, was passed by the Lok
Sabha with voice vote, completing the budgetary process in the lower
house.
In a swipe at the Congress, the Minister said that unlike the previous
UPA dispensation, the present Modi government in the interim budget did
not reduce levies of SUVs which are used by rich persons.
In the Finance Bill 2019, the Minister proposed to raise
tax rebate
for people having annual income up to Rs 5 lakh from Rs 2,500 to Rs
12,500, which will effectively ensure that they don't have to pay any
tax.
In the Bill,
standard deduction has also been raised from Rs 40,000 to Rs 50,000,besides a host of tax benefits to home buyers.
The concessions proposed in the Finance Bill, Goyal said, are
aimed at helping "poor and middle class people living on tight
budget...This is interim budget. We have not brought any tax
proposal...we will bring them in July," he said.
The next government, which will be formed after the upcoming general
elections, will come out with full budget in July. The next government
will also come up with a Finance Bill containing the tax proposals for
2019-20.
The Minister said that if the Congress and other opposition parties had
objections on the government giving rebate to middle class tax payers
and announcing income scheme for farmers, they should write in their
election manifesto their intention to reduce tax exemption limit and
withdrawing the farmer income scheme after coming into power.
Goyal was responding to the issues raised by certain members as to why
the government announced concessions in the interim budget, ahead of the
general elections.
Elaborating on his tax proposals, Goyal said that the decision to raise
the rebate for people having annual income of Rs 5 lakhs was to provide
greater certainty about tax liability as salary payments to them is
subject to
Tax Deduction at Source (TDS).
The Minister said as per the calculations done by the officials, an individual having income of Rs 9 to Rs 9.5 lakh can escape
income tax liability by taking advantage of the host of tax savings schemes under the Income Tax Act.
The proposal, Goyal added was welcomed within and outside the house and
will provide requisite impetus to savings and boost economic growth.
He said that the Modi government during the last four- and-a-half years
tried to benefit every section of society and tax payers.
As a result, he said, the tax base in the country increased, the tax
collection had doubled in the last five years and India has become the
fastest growing major economy in the world.
Higher collections, he said, has enabled the government to earmark more
resources for the socially and economically deprived sections of the
society.
The Minister said that the proposal to raise standard deduction from Rs
40,000 to Rs 50,000 and hiking TDS limit on interest income from Rs
10,000 to Rs 40,000 will provide relief to senior citizens.
The housing sector, he added, will too get a a boost on account of the
proposals including interest subvention, allowing capital gains tax
exemption on purchase of two flats from proceeds of sale of a house and
hiking rebate on repayment of home loans.
The government, he added, was working to ensure house for every citizen when India celebrates 75th year of Independence.
The government policies have helped in keeping the property prices under
check, he said, adding the non- performing assets (NPAs) too has
remained low in the sector, probably because "housewives insist that the
home loans are repaid in time."
On the fiscal deficit numbers, the Minister said that as a chartered
accountant he could have made some adjustments to keep the fiscal
deficit to the targeted level of 3.3 per cent of the GDP for 2018-19,
but did not indulge in window dressing and instead prepared the budget
honestly.
As per the budget document the fiscal deficit during 2018-19 is expected
to go up to 3.4 per cent of the GDP as against the target of 3.3 per
cent.