It is because the tax rebate which was earlier Rs 2,500 has now been raised to Rs 12,500.This makes the income tax turn out to be NIL for taxpayers earning less than Rs 5,00,00 per annum.The average monthly tax collection in the current year came out to be Rs 97,100 Crores per month.
For the first time, the benefit of presumptive taxation was extended to small professionals.
The threshold limit for small professionals was thereby fixed at Rs 50 lakh.
Such a rebate or deduction would amount to the lower of 100% of such income tax or Rs 12,500.
The purpose of such a rebate is to reduce the tax burden of individuals in the lower income bracket.
Here are the highlights of India Budget 2019 – 2020.
As a result of continuous reduction in GST, most items of daily use now fall in the 0% to 5% tax slab.
Such a rebate is given to an assessee under section 87A of the Income Tax Act, 1961.
The last amendment made to the section was undertaken in the Finance Bill 2017.
Also, to promote a less cash economy, the presumptive profit rate has been reduced from 8% to 6%.
And finally, the tax rate for companies with turnover of up to Rs 250 crore was reduced to 25%. The Standard Deduction for Salaried Employees has increased from Rs 40,000 to Rs 50,000.