Budget 2020, Highlights & Important points to consider
Budget 2020-2021, presented today by our honourable finance minister, Nirmala sitharaman. Here , we came to administer a new tax regime in which a normal taxpayer who is not taking any tax deduction till now, get benefitted with lower tax slabs.
New tax slabs has eliminated tax upto the income of five lakhs in which middle and lower middle group will get benefitted more.
Taxes from 5 - 7.5 lakhs reduced from existing 20% to 10% , 7.5 - 10 lakhs reduced from current 20% to 15% , 10 - 12.5 laks reduced from current 30% to 20% , 12.5 - 15 lakhs from current 30% to 25%.Tax Slabs above 15 lakhs has kept at previous rates of 30 %.
New tax regime came with an option to choose from current slab rates or previous slab rates in which differerence is of deduction benefits, which says, If you choose to get deduction of 80c, 80 D 10,10D etc. then you have to opt the previuos tax rates in which old slab will prevail . In other scenario, if we choose not to invest in tax saving instruments specifically for tax rebate, then new tax slab rate is made available for you.
This budget in its clear picture show liquidity measures in the hands of taxpayers who previousy invests in specific options just for the sake of tax benefits instead of other options or taking it as a liquid. But now there is an option in which just pay a nominal amount as tax to the government and invest or use your money as you wish to use or invest.
Budget 2020,focussed long term growth of the economy. Finance minister sought a growth rate of 10% in coming financial year with a fiscal deficit of 3.8 % instead of previously sought rate of 3.3%. This announcement made foreign investment more attractive by removing dividend distribution tax for the companies which is now be taxed in the hands of investors. There is not any relaxation for LTT or STT.
Now, the investor or an individual has to make separate calculation or computation based on their income and choose from the tax rates to go with.