Business | Economy
Minimum taxable income raised to $3,754
India's government proposed raising the minimum taxable income by 36 per cent as it collects more taxes with fewer people avoiding payment in a growing economy.
- Bloomberg
- Published: 01:04 March 1, 2008
-
$15-b loan bailout for India farmers
India unveils farmer-friendly, pre-election budget
-
Farmers get pre-poll bonanza as $15b in loans are waived
Farmers get pre-poll bonanza as $15b in loans are waived
-
Chidambaram seeks to abolish 6% excise duty on petrol and diesel sales
Chidambaram seeks to abolish 6% excise duty on petrol and diesel sales
-
India cuts taxes as growth slows
India cuts taxes as growth slows
-
Budget has nothing specific for NRIs
Budget has nothing specific for NRIs
New Delhi: India's government proposed raising the minimum taxable income by 36 per cent as it collects more taxes with fewer people avoiding payment in a growing economy.
India plans to raise the minimum taxable income to Rs150,000 ($3,754) from Rs110,000, Finance Minister Palaniappan Chidambaram said.
India's tax collection increased to 12.5 per cent of the country's gross domestic product this year from 9.2 per cent a few years earlier, Chidambaram said.
The country is the world's second-fastest growing major economy after China.
"High growth rates have helped," Chidambaram said. "Changes and attitudes have also helped" with tax collection.
The change would mean workers in India will only pay taxes if their salaries exceed Rs150,000. For those earning between Rs150,000 and Rs300,000, the amount will be taxed at 10 per cent, and the rate rises to 20 per cent for earnings of Rs300,001 to Rs500,000.
On income exceeding Rs500,000, the tax rate is 30 per cent, Chidambaram said.
The tax benefit probably won't lead to a significant increase in spending, said Sudhir Kapadia, head of taxes at KPMG, an accounting and consulting company.
"The minister himself has said it would lead to a gain of about Rs4,000 and that's nothing spectacular,'' Kapadia said. "This is not going to have any dramatic impact."
Chidambaram left tax rates for other categories unchanged.
Share this article
Related Articles
Popular in Business
-
General
Precious jump
Gold prices at new high as India's central bank buys $6.7b worth of gold
Business Editor's choice
-
UAE companies in full force at WTM
Seventy-eight participants are from Dubai and 50 from Abu Dhabi
-
DIFC committed to high standards
Ensures an efficient process to serve the business community
-
Sweet life in the Middle East
A sweet look at the confectionary industry in the UAE and Middle East
