Question

Identify and briefly discuss 3 key issues or measures covered under the Income Tax Act 1967 which concern individual taxpayers that were introduced by the 2020 Budget and state their proposed implementation dates.

Answer 1

1.New optional personal income tax system was proposed in th budget 2020 by Shri Nirmala Seetharaman. She also announced in the budegt about the multi billion dollar farm, infrastructure and a health care package for reviving growth in the country .

This budget 2020 is going to boost income and purchasing power of the people in the country.

2. The budget also raised the insurance coverage to Rs.5 lakhs from Rs. 1 lakh to the bank depositors.

3. New optional tax slabs are available for those who forgo exemptions . This new tax system removed most of the deductions and exemptions. This slabs are applicable to the taxpayers from April 01 ,2020. The slabs bifurcation is as follows :

Tax Slabs Tax Rates Upto Rs. 5 lakhs Nil Rs.5-7.5 lakhs 10%.    Rs.7.5-10 lakhs 15% Rs.10-12.5 lakhs 20% Rs.12.5-15 lakhs 25% Rs.15 lakhs and above 30% 4. Divided distribution tax is also abolished ,which means earlier the companies are liable to pay DDT by deducting it from the dividend that is paid to the shareholder. but now as per the new budegt announcement , the DDT is completely removed and the dividend is taxable in the hands of the taxpayers as per the applicable tax rates from April 2020. 5. Aadhaar based verification of taxpayers ia being introduced from April 2020 to weed out the dummy or non - existent units . The budget also introduced instant online allotment of PAN on the basis of Aadhaar.