Fresh tax proposals to turn revenue-positive in 2012-13
Markets will look to consolidate in the week ahead after most event risks like monetary policy and budget now over.
The fresh tax proposal made in the Budget will give the exchequer a net gain of over Rs 41,000 crore in 2012-13, as against a net loss of Rs 200 crore in the current fiscal.
Announcing the budget proposals for 2012-13, Finance Minister Pranab Mukherjee said,"...direct tax proposals in the Budget will result in a net revenue loss of Rs 4,500 crore, indirect taxes will result in a net revenue gain of Rs 45,940 crore. Thus, the tax proposals will lead to a net gain of Rs 41,440 crore."
For the current fiscal, the government had estimated a net revenue loss of Rs 200 crore from fresh tax proposals.
The government expected a net revenue loss of Rs 11,500 crore from direct tax benefits given to individual taxpayers during the current fiscal, while expecting a net gain of Rs 11,300 crore from indirect tax proposals.
However, the government had targetted a net revenue gain of Rs 20,500 crore in 2010-11 and Rs 2,000 crore in 2009-10.
Mukherjee has given some relief to tax payers with a proposal to raise the income tax exemption limit for individuals to Rs 2 lakh per annum from Rs 1.80 lakh for the next fiscal.
He also increased the limit to Rs 10 lakh under the 20 per cent tax slab. The current limit is Rs 8 lakh.
Individual will have to pay 10 per cent tax on income between Rs 2 lakh and Rs 5 lakh; 20 per cent between Rs 5 lakh and Rs 10 lakh; and 30 per cent for above Rs 10 lakh.