Govt may levy surcharge on income above Rs 1 cr: Report

By Religare
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    Govt may levy surcharge on income above Rs 1 cr: Report
    The government is planning to introduce surcharge in the income-tax system and reports said that it has been considering bringing individuals with taxable income of over Rs 1 crore within its ambit.
     

    A surcharge is an additional levy on the tax that an individual pays. For example: If some is paying tax of Rs 30 lakh on an income of Rs 1 crore and then a surcharge of 10 per cent is levied, the total tax liability on the taxpayer would be Rs 33 lakh.

    Earlier, the finance ministry had said that it should debate the idea of taxing super rich to promote financial inclusion but failed to give the definition of "super-rich". Some experts said that government may term individuals earning over Rs 12 lakh as super rich, as per the formula used by US government in calculating that minimum threshold.

    Besides, experts also said that it may not tweak much the current income tax slabs in upcoming budget. One, it fears that raising the exemption limit from Rs 2 lakh at present would not just take many people out of the tax net. Two, it fears that it will usher in a higher income-tax exemption for all taxpayers and higher revenue loss for the government.

    Read more about: income tax
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