Prime Minister Narendra Modi's BJP promises to revise tax brackets to help the middle class if it is voted back to power in the national election starting Thursday. "After providing major tax relief in the recent budget, we are committed to further revise the tax slabs and the tax benefits to ensure more cash and greater purchasing power in the hands of our middle income families," the party says in its manifesto released on Monday by Prime Minister Narendra Modi and top BJP leaders.
"We will make all efforts to ensure that our aspirational middle class has access to education, employment opportunities and suitable urban infrastructure for a better quality life," the document adds.
In the Interim Budget in February, the government announced tax measures ranging from a full rebate on personal annual income up to Rs. 5 lakh to a 25 per cent hike in standard deduction threshold. The tax rebate is at a cost of Rs. 18,500 crore to the exchequer. Other tax measures included an increase in the TDS (Tax Deducted at Source) limit applicable to rental income to Rs 2.4 lakh from Rs 1.8 lakh, and the decision to allow house owners to claim relief on a second self-occupied property.
"Our economic policy has been guided by the principle of lowering the tax rate and improving compliance; thereby broadening of the tax base. With improved compliance and increased tax base, the tax to GDP ratio has reached 12 per cent, highest in the recent past, up from 10.1% in 2013-14. This increased revenue has been deployed for benefits to the poor and creation of infrastructure at an unprecedented level. We will continue with our policy in the similar manner - lowering of tax rate thereby rewarding honest tax payers and improving compliance," the manifesto said.
Elections will be held in seven rounds of voting from April 11 to May 19. The results will be declared on May 23.
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