Budget 2017: Tax rate for Rs 2.5 to 5 lakh income slab cut to 5 per cent

New Delhi: In a major relief to people in the lowest income slab, Finance Minister Arun Jaitley, while presenting the Union Budget 2017 on Wednesday, announced tax rate cut from 10 per cent to 5 per cent for this bracket.

“Income tax rate on income between Rs. 2.5 lakh and Rs. 5 lakh cut to 5 per cent from 10 per cent,” said Arun Jaitley.

Following is the table of impact on individual on tax proposals:

INCOME                              TAX RATE         IMPACT

1. Individual Tax Payers

Up to Rs 2,50,000                             NIL                           NIL

Rs 2,50,001 to Rs 5,00,000              5%                            Rs 7,725 (Savings)

2. Senior Citizens 60 years but less than 80 years

Up to Rs 3,00,000                            NIL                            NIL

Rs 3,00,001 to Rs 5,00,000             5%                             Rs 2,575 (Savings)

Rs 5,00,001 to Rs 10,00,000           20%                           Rs 7,725 (Savings)

3. Senior Citizens 80 years and above

Up to Rs 5,00,000                            NIL                           NIL

Rs 5,00,001 to Rs 10,00,000           20%                          Rs 7,725 (Savings)

“Persons with income between Rs 50 lakh and Rs 1 crore to pay an additional surcharge of 10 per cent,” added Arun Jaitley.

The surcharge of 15 per cent will continue for all earning Rs 1 crore and above. The increase in surcharge will help the government earn more.

Finance Minister further said that the government plans to enforce greater accountability on tax officer.

“I have outlined in the budget an overarching theme to transform, energise and clean India,” said the finance minister.