Govt doubles tax exemption for the middle class man

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Piyush Goyal also announced that all interest income above Rs 40,000 from bank deposits will now get taxed as against the earlier Rs 10,000.

In the interim budget presentation, finance minister Piyush Goyal increased the tax exemption from Rs 2.5 lakh to Rs 5 lakh. The Finance Minister is also expected to announce measures to entice farmers.

Doubling the threshold exemption limit will increase the burden on the exchequer by Rs 18,500 crore.

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"Capital expenditure programme of railways at all-time high of Rs 1.58 lakh crore in next financial year".

There will also be no tax on notional rent on the second self-occupied house and no TDS on house rent up to Rs 2.4 lakh.

Another swirling speculation is about the direct transfer program again for the farmers and to support small businesses. To douse the agrarian distress, there might be a proposal for waiving interest on crop loans for farmers who pay on time.

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For investors, these sops may translate into another breach in the Budget deficit target of 3.3 per cent of GDP for the current fiscal and a possible record borrowing in the coming fiscal.

Earlier Mr. Goyal said India has emerged as the brightest spot in the world in the last five years during which the country witnessed the fastest GDP growth higher than under any previous governments. In 2018-19, the largest downside to revenues has been from the GST mop up with the shortfall likely at around Rs 1.4 lakh crore.

Goyal will be presenting the Modi government's sixth and final budget before it goes for elections in May this year. From income tax slabs to farmer woes, the Budget 2019 is the Modi government's last shot before the elections to appease the Indians. This may or may not replace subsidies that the farmer gets.

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