Andhra Pradesh - Hyderabad

Salaried class bruised

HYDERABAD: The ‘Please All’ budget did not actually leave the salaried class euphoric in Hyderabad.

“It is good but not good enough”, they say.

Said AP NGOs’ Association Treasurer G. Satish, “Compared to the hike in prices, rising cost of living, IT exemption limit from Rs.1.10 lakhs to 1.5 lakhs is not much.

It’s time the IT exemption limit was raised to Rs. 2 lakhs.”

From the Class IV cadre, Government employees pay anywhere between Rs.5,000 to Rs.20,000 an annum as tax. With Interim Relief due for them from June, this small IT benefit would be nullified within three months, he said.

Practising Chartered Accountant C. Suresh described it as, “election budget full of sops.”

IT exemption limit hike has been across the board for all assesses. For a businessman, business-related expenditure is not taxed, while a salaried person enjoys no such concession.

Standard deductions exempted from IT computation should have been brought back for the salaried class, he felt.

With rationalisation of tax slabs, a man who earns Rs. 3 lakhs a year would now pay IT Rs.15,000 instead of Rs. 39,000 while a woman is to pay Rs.12,000 instead of Rs. 35,500 (exemption limit raised to Rs. 1.8 lakhs from Rs.1. 45 lakh).

In the Rs.5 lakh income slab, one would pay a tax of Rs. 55,000 instead of Rs. 99,000 while a woman would pay Rs. 52,000 as against Rs. 95,500.

But with inflation, real-time benefits will remain a question mark.

The progressive budget should have increased the cap on savings from Rs. 1 lakh to Rs. 1.5 lakh to encourage savings and Government should also have introduced basic threshold limit for fringe benefit taxes for the salaried classes.

Farida Tampal, State Director, WWF, welcomed the IT relief for women.

“This would enable women voluntary work who do not enjoy great pay scales but pay considerable IT save substantially in the fiscal 2008-09,” she said.

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