New Delhi: Contrary to widespread expectations for some populist measures in the Union Budget 2022, Finance Minister Nirmala Sitharaman on Tuesday announced no change in income tax slabs for 2022-23.
The income tax rates for 2022-23 also have not been revised.
While people with an annual income of up to Rs 2.5 lakh currently do not have to pay income tax, those earning between Rs 2.5 and Rs 5 lakh are taxed at 10 per cent, Rs 5 and 10 lakh at 20 per cent and it is 30 per cent for beyond Rs 10 lakh.
The FM, however, opposed a new updated return system, keeping the tax filing window open for two years of the filed IT Return. “To provide an opportunity to correct an error, taxpayers can now file an updated return within 2 years from the relevant assessment year,” she said.
It is an affirmative step in the direction of voluntary tax compliance, she added.
The minimum alternate tax (MAT) for cooperatives has been reduced from 18.5 per cent to 15 per cent. The redemption of taxes for 3 consecutive years offered to startups has been extended by one more year. “In view of the pandemic, I propose to extend the period of incorporation of eligible start-ups by one more year up to 31-3-2023 for providing tax incentives,” she said.
Any income from the transfer of any virtual asset will be taxed at the rate of 30 per cent, Sitharaman said, adding that no deduction will be allowed on these gains.
“I propose 1 per cent TDS on payment made in relation to transfer of virtual digital assets. Gift of virtual digital assets is also proposed to be taxed in the hands of the recipients,” she said.
The FM also proposed that the tax deduction limit for both Centre and State government employees will be increased from 10 per cent to 14 per cent. This is aimed at bringing state government employees on par with those of the central government.
She further proposed a 5 per cent cut in customs duty on cut and polished diamonds.
“The gross GST collections for the month of January 2022 are Rs 1,40,986 crores which is the highest since the inception of GST,” she added.
