Empowerment of Sindhi's

Modi government’s new plan will bring happiness on the faces of millions…Must Read

This is how your new income tax slabs may look after Budget of 2017

Your personal income tax might get reduced if Ministry of Finance acts on a proposal, Tarun Sharma of Zee Business reports.

Sources told the reporter that the finance ministry has proposed that no tax will be liable up to the income worth Rs 4 lakh. Currently, no tax is charged up to income of Rs 2.5 lakh per year.

The impact of demonetisation is seen as a prime cause for the Government to give this rebate in income tax. Currently, nearly 4% of the total population of India files income tax.

MOREOVER, AS PER THE PROPOSAL, THE GOVERNMENT LIKELY TO IMPOSE 10% TAX ON INCOME BETWEEN RS 4 LAKH TO RS 10 LAKH IN THE NEW TAX BRACKET. CURRENTLY, FOR THE INCOME EXCEEDING RS 2.5 LAKH TO RS 5 LAKH IS LIABLE FOR 10% TAX.

For the income between Rs 10 lakh to Rs 15 lakh, the tax rate is likely to be 15% as per the new proposal. Presently, 20% is imposed on income between Rs 5 lakh to Rs 10 lakh.

Further, for the income between 15 lakh to Rs 20 lakh, 20% of tax will be charged. Currently, 30% tax rate is levied on income more than Rs 10 lakh.

Income tax for income over Rs 20 lakh may be fixed at 30%, the source said.

According to some of the rumours “No Income Tax” could be Modi’s next move. The government is planning to execute this proposal in two parts.

Part A –

  • Recall and scrap old high denomination notes Rs.500 and Rs.1000.
  • Introduction of new Rs.500 and Rs.2000 Notes
  • Old Rs.500 and Rs.1000 notes to be deposited into account.
  • In 50 days bring around 15 Lac Cr in banks.

Part B –

  • Reduce Interest rate on saving bank account from 4% to 2% or less.
  • Reduce fixed deposit rates drastically.
  • Reduce home loan rate and keep it up to 7-8%.
  • Implement GST by 1st September, 2017.
  • Abolish Income Tax for individuals.
  • Reduce corporate tax rates.
  • Introduce new Banking Transaction Tax.

It is claimed that if economic reforms mentioned in Part A and Part B is successfully implemented India, India will be like USA. The government has already started implementing part A.  It is expected that by 30th December, 2016 around 15 Lakh Cr old high denomination notes will be deposited into various banks.

From the year 2017 implementation of Part B will commence. In the new year 2017 bank will have enough cash on hand hence saving bank interest rate will be reduced from 4% to 2%. In addition to that fixed deposit, rates will be reduced to 5% -7%.

Home loan and car loan interest rate will be reduced to 7% to 8%. The reduction in a home loan interest rate will straight away benefit real estate sector and affordable housing scheme project. The price of real estate will reduce and will be affordable to common man.

By September 2017 the government will introduce GST reforms where all tax will be replaced by single tax system called as GST. In addition to the introduction of GST, it is expected that corporate tax rate will be reduced to 30%.

Once all these steps will be executed Prime Minister Narendra Modi will give a gift to Indians by removing Income Tax. Income of every individual in India will be income tax-free then onwards. No Income Tax will be the biggest gift ever by any prime minister in the history of India.

Now a question arises that once the income tax is removed how the government will get money to run the nation. Well, once all cash will be deposited into banks everyone will be enforced to use banking system for every transaction. New banking transaction tax will be introduced. Every transaction such as cheque, Demand draft, RTGS, NEFT, Credit Card, Debit card etc will come under this new tax system. The rate of the new banking transaction tax will be 0.10% to 7%. Everyone including farmer will be covered under new banking transaction tax system. The government will directly get the income based on transactions. No black transaction will be entertained. The strict rule will be formulated for unaccounted money and nonbanking transaction.

It is expected that implementation of above steps will give following benefits.

Benefits of Implementation

  • Transparency in Economy
  • More purchase power to individual
  • Saving in amount of tax paid
  • Drop in commodity prices
  • Availability of Loans from bank at lower rates
  • Terrorist and anti-national activities will be eliminated
  • Significant growth in the employment
  • Indian economy and business will be globally competitive

Leave a comment