New Delhi: Finance Minister Piyush Goyal on Friday said that income tax refunds will be processed within 24 hours and released immediately as the Narendra Modi government reached out to the middle class with the election year budget.
"Within the next two years, the assessment of all tax returns should be done electronically without any personal interface," Goyal said, while delivering the interim Budget for 2019-20.
The interim finance minister also proposed the doubling of income tax exemption limit to Rs 5 lakh from the current ceiling of Rs 2.5 lakh, but left the implementation to the next government.
“Thank you”, he said to the taxpayers and announced that direct tax collections have risen from 6.38 lakh crores in 2013-14 to almost 12 lakh crores. He said with this, individuals who are earning gross income of Rs 6.5 lakh per year and have made investments in savings instruments, will be exempt from paying income tax.
"This will provide benefit of Rs 18,500 to 3 crore middle class taxpayers self employed, senior citizens," he said, adding the number of beneficiaries will go up for those who have made investments in mediclaim and pension.
No tax will be deducted on interest earned on bank and post office deposits of up to Rs 40,000 annually, up from Rs 10,000 currently.
The Budget also proposed to exempt tax on notional rent for unsold housing units for two years. Goyal also proposed that benefit of rollover of capital tax gains be increased from investment in one residential house to that in two residential houses, for a taxpayer having capital gains of up to Rs 2 crore. However, it can be exercised once in a lifetime, he added.
Standard deduction has been raised from Rs 40,000 to Rs 50,000 which will benefit three crore salaried individuals.