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| Edited By: Gangapriya Chakravarti |Source: DNA |Updated: Mar 17, 2018, 06:54 AM IST
This may be perhaps the last time that anyone would be writing about the impact a budget has on the taxation of salaries for Indian citizens.
With the finance minister reconfirming the date of implementation of the proposed Direct Taxes Code (DTC) as April 1, 2012, in his budget speech, it seems unlikely that changes to tax rules would need the vehicle of the annual budget for any amendments.
One would also hope that the periodic tinkering that successive finance ministers have resorted to with respect to tax rules, particularly with respect to salaries has made the Indian salary structure one of the most difficult to understand in the world.
This is notwithstanding the fact that there have been recent attempts at consolidation and simplification of tax provisions. The proposals in this budget do have a focus on the ultimate state that the DTC will usher in.
From the salary perspective, there have been expectations that the limits for several of the components reimbursed as part of the salary would be raised. However, the budget has belied most of these and the announcements regarding taxation of salaries seem very much as a build up to the provisions contained in the DTC.
The finance minister seems to have gone a bit creative with age (pun intended!). While classifying those above 60 years of age as senior citizens, he has also introduced a category of the very senior citizens to cover those above 80. Senior citizens will now have a higher tax exemption limit at Rs 250,000 while the very senior citizens will not need to pay tax until double that amount. This is definitely going to make my father a happy man!
Sugam will take over from Saral for the small taxpayer as an attempt is made to further simplify the tax filing process. We will have to wait and see what that involves. As of now all eyes will be trained on the DTC. It promises to be bring in a level of simplicity into tax management and hence, compliance and hopefully, some permanence and stability too.
Gangapriya Chakraverti is a human resources consultant.
