The Union budget has proposed raising taxes on the super-rich by increasing the surcharge on tax on those earning more than ₹2 crore.
Presenting her maiden budget, Finance Minister Nirmala Sitharaman said the surcharge on income tax for those earning between ₹2 crore and ₹5 crore has been raised to 3 per cent and for those earning more than ₹5 crore, it has been raised to 7 per cent.
There was no change in tax rates for those earning below ₹2 crore. Income tax was waived for those earning up to ₹5 lakh in February by the then-acting Finance Minister Piyush Goyal.
As per the Central Board of Direct Taxes (CBDT) data, the total number of taxpayers, including corporates, firms and HUFs, having more than ₹1 crore income stood at 1,40,139 for the assessment year 2017-18.
Of this, the individual number of individual taxpayers having income above ₹1 crore was 81,344 in the same period.
In another move that could hurt the super-rich, Sitharaman said, “I propose to levy a TDS of 2 per cent on cash withdrawal exceeding Rs 1 crore in a year from a bank account.”
This, she said, was to encourage digital transactions in the country, as per the Digital India initiative.
The Budget proposes to make return filing compulsory for persons, who have deposited more than ₹1 crore in a current account in a year, or who have expended more than ₹2 lakh on foreign travel or more than ₹1 lakh on electricity consumption in a year or who fulfils the prescribed conditions, in order to ensure that persons who enter into high value transactions also furnish return of income.