Budget being round the corner, the so called 'Aam Admi' would be curious to know if there will be any increase in their disposable income. Every year there is a general expectation from the individual tax payers on the budget proposals relating to personal taxation, especially on the tax rates/tax slabs. This expectation is further heightened this time due to the impact of global economic slowdown directly or indirectly impacting the growth in India and inflationary trends in the domestic market. Let us first look at the change in tax slabs over the last 5 years. As seen above, the exemption threshold has been increased over the years. One needs to keep in mind that Indian tax laws do not provide any major deduction (other than a threshold of Rs 1,00,000 & mediclaim) for expenditure to salaried tax payers and all income above the threshold limit is liable to tax. The budget 2012-13 may bring some cheer to the Aam Admi as the government is said to be considering restructuring of income tax slabs as well as the income tax exemption limit.
Source: Economic Times
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