Finance Minister Pranab Mukherjee on Monday proposed to raise the income tax exemption limit for general tax payers to Rs 1.80 lakh per annum from Rs 1.60 lakh at present and introduced a high new tax slab for very senior citizens of 80 years and above.
Unveiling the Budget proposals for 2011-12 in the Lok Sabha, he also proposed to reduce the age limit for consideration as senior citizens from 65 years to 60.
Senior citizens will get tax exemption for income up to Rs 2.5 lakh, higher from Rs 2.4 lakh now.
As per the announcement, the increase in the income tax exemption limit for general tax payers (excluding women and senior citizens) to Rs 1.8 lakh per annum would translate into a benefit of Rs 2,000 for all tax payers.
At present, the general tax payers earning more than Rs 1.6 lakhs per annum are required to pay income tax.
Introducing a new tax slab for very senior citizens (80 years and above), Mr. Mukherjee said, they will not have to pay any tax for annual income up to Rs 5 lakh.