No changes in Income tax slabs 2022, Govt employees’ tax deduction limit increased to 14%.
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While presenting the Union Budget on Tuesday, Finance Minister Nirmala Sitharaman proposed no change in income tax slabs. She, however, proposed that both Centre and states government employees’ tax deduction limit be increased from 10% to 14%. The move, she said, will help the social security benefits of state government employees and bring them at par with the Central government employees.
The Finance Minister also proposed a reduction in corporate surcharge and said that the transfer of any virtual digital asset shall be taxed at the rate of 30%. “Corporate surcharge to be reduced from 12% to 7%. I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30%. No deduction in respect of any expenditure or allowance.
With the Budget proposing taxing virtual assets at 30%, Sitharaman said that it cannot be mentioned as a replacement of any other income and 1% TDS to be charged further on payments made using digital assets to keep a track on transactions. Sitharaman said that cooperative societies can now pay 18.5% alternate minimum tax and companies pay 15%. From now, cooperative, too, will have to pay only 15%. She added, “To provide an opportunity to correct an error, taxpayers can now file an updated return within 2 years from the relevant assessment year…Digital rupee to be issued using blockchain and other technologies; to be issued by RBI starting 2022-23. This will give a big boost to the economy.” The Finance Minister also announced tax relief for persons with disabilities. The parents or guardian can take insurance from their children with disabilities, she said. The payment of annuity or lump sum for disabled dependent will be exempted during the lifetime, she added. The Budget has also extended the timelines for benefits under the new corporate tax regime. The government had announced a 15 per cent corporate tax rate for newly incorporated manufacturing companies till March 31, 2023, which has now been extended till March 31, 2024. The period of incorporation for startups to avail the tax benefits has also been extended by a year to March 31, 2023.
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