01/03/2016
Budget 2016: How FM Arun Jaitley Has Affected Common Man's Spending & Savings Plan.
1) Buy your dream home: By introducing an additional deduction of Rs 50,000 in the Budget 2016 proposal, Finance Minister Arun Jaitley has given some reason to cheer to the first time home buyers.
Jaitley has also proposed to give 100% deduction for profits to an undertaking from a housing project for flats upto 30 sq. metres in four metro cities and 60 sq. metres in other cities, approved during June 2016 to March 2019, and is completed within three years of the approval. Minimum Alternate Tax will however apply to these undertakings.
Distribution made out of income of SPV to the REITs and INVITs having specified shareholding will not be subjected to Dividend Distribution Tax.
He also proposed to exempt service tax on construction of affordable houses up to 60 sq. metres under any scheme of the Central or State Government including PPP Schemes.
2) Relief for small tax payers & rent payers: The ceiling of tax rebate under Section 87A of IT Act has been proposed to be raised to Rs 5,000 from Rs 2,000 for individuals with income less than Rs. 5 lakhs. He said that above 2 crore tax payers would get a relief of Rs 3,000.
The limit of deduction of house rent paid under section 80GG has also been raised to Rs 60,000 from the existing Rs 24,000 per annum to give relief to employees who live in rented houses.
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