Income Tax Dept warns public against cash dealings of Rs 2 lakh or more saying that the receiver of the amount will have to cough up an equal amount as penalty.

Budget 2019 Expectations: Govt may Double Income Tax Threshold Limit

In a major relief to taxpayers, the Central Government may take a major decision in the upcoming interim budget to increase the exemption limit for income tax to five lakhs from the current 2.5 lakhs. 

The 2019 Budget will be tabled by Finance Minister Arun Jaitley on February 1. Inputs were sought from various central ministries as early as in October. 

It was said that “The impact of Demonetisation has been felt on the collection of personal income tax. Its collections were higher in Financial Year 2018-19 (till 31-10-2018) compared to the previous year by 20.2%. Even in the corporate tax, the collections are 19.5% higher. From two years prior to Demonetisation, direct tax collections have increased by 6.6% and 9% respectively. In the next two years, post Demonetisation the increase by 14.6% (part of the year before the impact of Demonetisation in 2016-17) and an increase of 18% in the year 2017-18.”

“Similarly, in the year 2017-18, the tax returns filed reached 6.86 crores, an increase of 25% over the previous year. This year, as on 31-10-2018, already 5.99 crore returns have been filed which is an increase of 54.33% compared to the previous year till this date. The new filers added this year are 86.35 lakh.” 

“In May 2014, when the present Government was elected the total number of the filers of income tax returns was 3.8 crore. In the first four years of this Government, it has increased to 6.86 crores. By the time the first five years of this Government are over, we will be close to doubling the assessee base.”

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