Budget 2012: Liberal Tax System for DTC

By siliconindia  |  Tuesday, March 13, 2012

Bangalore: The Standing Committee on Finance has suggested a very moderate tax regime in its proposals on the Direct Taxes Code Bill, 2010 (DTC). The key suggestions made by the committee affecting individual tax payers are:

Tax Rates

The critical exemption limit as restricted in DTC is suggested to be improved from 2 lakh to 3 lakh and the tax slabs are also to be extended where individuals pay tax at 10 percent on income between 3 lakh and 10 lakh, 20 percent on income between 10 and 20 lakh and 30 percent on income above 20 lakh.

Employment Income

Payment and reimbursement of medical insurance premium will be made tax-free. Under DTC, it is measured as a taxable bonus. Committee has also suggested taxing the stock option benefits only at the time of sale rather than on vesting.

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