Written By: Yashika Sabharwal
Union Budget 2019-20: Key Highlights of Interim Budget
Union Finance Minister Nirmala Sitharaman is all set to table the Union Budget for the full fiscal year 2019-2020 on July 5, 2019 (Budget 2019 date).
The Union Cabinet Ministers of India said, “The Individuals with a taxable income around Rs.5 lakh annually will get a surprise of full tax rebate“. This surprise rebate is going to benefit around 3 crores of Indian people and middle-class taxpayers. They also clarified that those individuals who had their gross annual income – up to Rs. 6.5 lakh have no need to pay any tax only in the case if they are making any investments in providential funds and prescribed equities.
Key Highlights – For Individuals
- Full tax rebate to individual taxpayers whose annual income is up to Rs. 5 lakh;
- The benefit of rollover of capital gains has been increased. Now, one can invest in two residential houses in order to save capital gain tax for a taxpayer having capital gains up to Rs.2 crore. Currently, it is permitted to make an investment in one house property. However, this can be exercised once in a while. Now the exemption under section 54 will be available;
- For the Financial Year 2019-2020 – Income Tax slabs shall remain the same;
- If the individual makes investments in provident fund and prescribed equities then there is no need to pay tax on gross income up to Rs. 6.5 lakhs;
- For salaried persons, the standard deduction has been raised from Rs. 40,000 to Rs. 50,000;
- This budget is going to benefit around 3 crore middle-class taxpayers as they will get full tax rebate up to the annual income of Rs. 5 lakhs;
- Gratuity limit has been raised from Rs.10 lakhs to Rs. 30 lakhs.
What is an Interim Budget?
In parliament, the BJP government announced the interim budget. For your better understanding, we would like to tell you “what exactly the interim budget is?”
As we know that it is the last year of the current government and general elections are coming up, therefore, the budget is for the short span of time, not for the entire year. This is the transitory period between the two governments. Unlike the other budgets in India, this interim budget 2019-20 does not have any major policy decisions. If the budget has been presented before the declaration of election date then any policy decisions can be announced by the ruling government. As per the reports, this budget can affect the expenditure of the next government.