The Union Budget 2019 was a pre-election budget, hence a highly anticipated one. Although the interim budget was pro-poor, the current government did not disappoint the business community since it gave a boost to the consumer economy. It has brought in changes in the tax slabs and introduced many new schemes for many sections of the society. Let’s take a quick look at the major tax reforms in the budget tabled on February 1, 2019.
Tax Exemption and Relief
- With the new budget, the salaried class along with the pensioners are expected to get a tax benefit of around INR 4,700 crore. The minimum taxable income has been raised to INR 5 lakh which has been warmly welcomed by the salaried class in the country.
- The increase in standard tax deduction from INR 40,000 to INR 50,000 is another respite for the salaried employees who belong to the higher income brackets.
- Individuals with an unoccupied second house are not required to pay tax on it which is a notable point in the budget.
- The ceiling of gratuity payment has been increased from INR 10 lakh to INR 20 lakh.
- The Employee State Insurance (ESI) eligibility cover has been enhanced from INR 15,000 per month to INR 20,000 per month.
- Additional deductions include interest on a home loan for up to INR 2 lakh, interest on educational loans and medical insurance for the salaried class.
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