Suggestions for the forthcoming Union Budget – 2018
1. Taxation slabs are to be reworked as follows (all Amounts in Rupees):
Class of the Assessees
Applicable Tax Rate %
Senior Citizens aged above 80 Years
Up to ₹12,00,000
₹12,00,001 and above
Senior Citizens aged 60 years and above
Up to ₹9,00,000
₹9,00,001 and above
All other Individuals
Up to ₹600,000
₹6,00,001 and above
Associations of Individuals / HUF / Partnership Firm / Trusts and Societies
Up to ₹300,000
₹3,00,001 and above
Private, Closely held and Unlisted companies
Up to ₹6,00,000
₹6,00,001 and above
Widely held, Listed Companies and other legal entities(except those notified by the union government)
Up to ₹600,000
₹6,00,001 and above
Note: There is no gender preference or discrimination of individuals.
(a) These limits shall be linked to some benchmark say Consumer Price Index and shall be automatically revised in the annual budget every year, in future.
(b) False claims made by 'passive income earners' must be rejected outright. Passive income earners are those individuals who are not directly engaged in any kind of income generating activity and income of another member from their family is shown as income of such passive member, with the sole objective of evading tax.
2. Following exemptions under Chapter VI-A must be available in addition for the individuals.
Restricted to Gross Earnings per year (%)
Contributions made to EPF/GPF
80 - C
Investments made in Infrastructure Bonds
80 - CCF
Premium paid for Health Insurance policies
80 - D
Premiums paid for LIC Policies (Pure life cover policies)
80 – LI*
Standard Deduction for Salaried Persons
80 – SD*
Not applicable to Self Employed Professionals & Business persons
* These are new sections proposed to be inserted
NOTE: (1) Aggregate amount of all the above-mentioned exemptions shall not exceed ₹3 Lakhs.
NOTE: (2) Exemptions under all other sections to be abolished/withdrawn.
1. As for Conveyance, if the reimbursement is done in terms of a specified quantity of petrol, then for 2 wheelers, exemption must be given up to 30 litres a month and for 4 wheelers, exemption up to 60 litres a month is to be given.
2. If a fixed amount is paid as conveyance allowance every month, the exemption limits per month are as follows..
(a) 2 Wheelers – Rs.2,100
(b) 4 Wheelers – Rs.4,200
3. For salaried persons who are subjected to frequent transfers (say, not less than once every 5 years), the entire portion of their HRA is to be exempted from tax.
4. In case of quarters/leased accommodation provided by the employer, it shall not be treated as a perquisite and is to be fully tax-exempt.
5. In case of loans given by the employer on concessional terms (interest-free advances included), they shall be taxed at the hands of the employer, not the employee.
6. Dividends exceeding Rs.24,000 shall be included in the income of the recipient and taxed accordingly.
Tax on Agricultural Income
1. Income from agricultural activities that are directly related to production of food grains, cereals, pulses, vegetables, fruits, pulses, sugarcane, oilseeds and all other edible items, cotton, silk (other than synthetic yarn and fabric) etc. must be exempted from Income Tax up to Rs.20 Lakhs per year for individuals and up to Rs.50 Lakhs per year, in case of non individuals.
2. In case of Tea, Coffee, Rubber, Cardamom and other spices (which are collectively known as ‘Plantation Crops’), no exemption shall be made available.
3. Construction of Warehouses and Cold Storages shall be extended cheaper bank loans say simple interest at 6% p.a. Other than that, no other subsidy or concession needs to be given.
Tax on Educational Institutions, Clubs, Associations, Societies and Trusts
All such institutions must be brought under the purview of Income Tax, if their annual turnover exceeds Rs.1 Crore. They shall be treated on par with 'private limited companies' for taxation purpose. However, Government of India may decide to exempt some charitable trusts from income tax, subject to certain conditions. For instance, these institutions shall not be controlled and managed by a few individuals and their family members. No hereditary rights will pass on from one generation to the next one.
Application from such institutions for tax exemption shall be considered on a 'case to case basis'
Ceiling for exemption of Wealth Tax shall be raised from Rs.30 Lakhs to Rs.1 Crore
Petroleum products and Alcohol & Spirit of all kinds must be brought within the ambit of GST within 6 months.
All Toll Gates in the country must be removed in phases. To begin with, all toll gates where the original contract period has already expired for the particular stretch of the highway must be removed immediately. The remaining toll gates must be removed within the next 2 years, with not less than 5% of them getting removed each month
Government of India must disclose complete particulars of Petroleum/Diesel Cess collected in the past (cumulative figures) and also how it was/is being utilized/spent.
Similarly, Government of India must disclose complete particulars of Education and Higher Education Cess collected in the past (cumulative figures) and also how it was/is being utilized/spent.
Both Central and State Governments must upload complete details of their Receipts and Payments (not just Income and Expenditure) in their official websites and keep updating such information every 3 months.
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