Major Tax related updates:

1. Direct Tax Code implementation expected by April 2011
2. Goods and Services Tax implmentation postponed to April 2011
3. Saral-II (2 Page Income Tax Return) Form comes for simple I-T return filing of Salaried individuals.
4. Tax rates - income limits extended drastically:
   
   1. In case of Male
      
      1. Up to 1.6 Lakhs => 0%
      2. Up to 5 Lakhs => 10%
      3. Up to 8 Lakhs => 20%
      4. Above 8 Lakhs => 30%
      
      
   2. In case of Female
      
      1. Up to 1.9 Lakhs => 0%
      2. Up to 5 Lakhs => 10%
      3. Up to 8 Lakhs => 20%
      4. Above 8 Lakhs => 30%
   3. In case of Senior Citizens
      
      
      1. Up to 2.4 Lakhs => 0%
      2. Up to 5 Lakhs => 10%
      3. Up to 8 Lakhs => 20%
      4. Above 8 Lakhs => 30%
5. New section 80CCF: 20 Thousand deduction for investments in Infrastructural Bonds
6. TDS late payment interest rate raised from 1 to 1.5% per month. (Section 201 Amendment)
7. Companies => Surcharge rate reduced from 10 to 7.5%
8. Minimum Alternate Tax rate changed from 15 to 18%
9. Form 16/16A continues as earlier.
10. No change in Service Tax rate. Additonal services added to increase the revenue.
11. Treshold Limits for TDS extended as below:
    
    1. 194B (Lotteries) => 10,000 (earlier 5,000)
    2. 194BB (Horse Race) => 5,000 (earlier 2,500)
    3. 194C (Contracts) => 30,000 (earlier 20,000)
    • Multiple transactions together, it is 75,000 (earlier 50,000)
    4. 194D (Insurance Commission) => 20,000 (earlier 5,000)
    5. 194H (Commission/Brokerage) => 5,000 (earlier 2,500)
    6. 194I (Rent) => 1,80,000 (earlier 1,20,000)
    7. 194J (Technical/Professional Fee) => 30,000 (earlier 20,000)