In what can be called as the masterstroke of the Narendra Modi government, Finance Minister Piyush Goyal announced full tax rebate up to Rs 5 lakh for the individual taxpayers in the Interim Budget speech in the Lok Sabha on Friday. The mega tax announcement will benefit three crore middle class taxpayers. “Individual taxpayers having annual income upto Rs 5 lakhs will get full tax rebate. Individuals with gross income up to 6.5 lakh rupees will not need to pay any tax if they make investments in provident funds and prescribed equities,” Goyal said. The announcement brought cheer to the Dalal Street as Sensex zoomed over 400 points. Standard tax deduction for salaried persons raised from Rs 40,000 to Rs 50,000. Benefits under Section 80 (i) BA being extended for one more year, for all housing projects approved till end of 2019-2020.
The TDS or tax deducted at source threshold on interest on bank and post offices deposits raised from RS 10,000 to Rs 40,000.
Apart from the middle class, farmers were also the biggest gainer in the Interim Budget. Farmers who own up to 2 acres of land will be given Rs 500 a month i.e. Rs 6000 a year. This income support will be transferred in three equal instalments, said FM Goyal while presenting the Interim Budget for FY19. This project will be funded solely by the Central government and directly imapact 12 crore farmer families. The scheme will cost the government Rs 75,000 crore. The Finance Minister announced 8 crore free LPG connections under the Ujjwala Yojana. "We have got decisive mandate to continue structured reforms. We have reversed policy paralysis," he added.
Prime Minister Narendra Modi-led government's sixth and final budget before the polls due by May is an interim budget or a 'Vote on Account'.
Goyal stepped in as interim finance minister after Arun Jaitley had to fly to New York for medical treatment. Goyal began the interim budget speech by wishing Union Minister Arun Jaitley speedy recovery and good health. Earlier, the Cabinet had approved the Interim Budget for 2019-20.