New Delhi | The government today increased the surcharge on the super-rich having an annual income of over Rs one crore by three per cent to 15 per cent. Unveiling the Union Budget for 2016-17, Finance Minister Arun Jaitley said he proposes to raise the surcharge from 12 per cent to 15 per cent on persons, other than companies, firms and cooperative societies having income above Rs 1 crore.
The Finance Minister, however, left the current income tax slabs unchanged. A surcharge of 10 per cent on taxable income of Rs 1 crore and above was imposed in 2013-14 by the then Finance Minister P Chidambaram. In the last Budget, Jaitley had abolished the wealth tax and replaced it with an additional surcharge of 2 per cent on the super-rich with a taxable income of over Rs 1 crore.
In a relief to people who do not have any house of their own and at the same time are not given any house rent allowance from (their) employer, Jaitley increased the limit of deduction to Rs 60,000 to compensate them from the rent they pay. I propose to increase the limit of deduction in respect of rent paid under section 80GG from Rs 24,000 per annum to Rs 60,000 per annum, which should provide relief to those who live in rented houses, he said.
In order to lessen tax burden on the individuals with income not exceeding Rs 5 lakhs, the minister proposed to raise the ceiling of tax rebate under section 87A from Rs 2,000 to Rs 5,000. There are 2 crore tax payers in this category who will get a relief of Rs 3,000 in their tax liability, Jaitley said.