I-T limit may be raised by Rs 20k | business | Hindustan Times
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I-T limit may be raised by Rs 20k

business Updated: Feb 20, 2011 23:47 IST
HT Correspondent

Finance minister Pranab Mukherjee may have some good news for the salaried class in his forthcoming budget, with the government considering a Rs 20,000 raise in the income tax exemption limit from the current Rs 1.60 lakh per annum.

Government sources said the move is aimed at putting money into the hands of people hit by sharp rises in the prices of essential commodities.

"At this point in time, giving relief for rising prices is a bigger priority," said an official, who did not want to be named.

Food prices have remained stubbornly high - at 15.7% in January - driven by a supply crunch in staple vegetables.

Weather problems in Australia, Argentina and Russia have hit global food and commodity prices, while oil prices have crossed $100 a barrel.

These have collectively pushed up the prices of other goods because they add to costs. As a result, the overall benchmark inflation rate was 8.23% in January.

The last major hike in the income tax exemption limit was in 2008-09 when the then finance minister P Chidambaram increased the exemption threshold by Rs 40,000 in one go to Rs 1.50 lakh per annum.

That was increased to Rs 1.60 lakh per annum the following year.