FY09-10 Indian Financial Bill

FY09-10 Indian Financial Bill

Year 2009 is when INC(Indian nation congress) regained ruling with a very good number of seat. Everyone and every institute appreciated the victory, they thought to pay back to the loyal citizens with the most populist budget.

The final Budget of FY09-10 is introduced in the lower house call Lok Sabha. Here it an appeal as populist one but soon you will realize is it populist or its a tool to convert you to pay more tax than ever.

Some main good points as per my 1st cut view :
1. Corporate Tax rates- no change.

2. Exemption limit in personal income tax raised (15,000 for senior citizens and 10,000 for others).

3. Fringe Benefit Tax abolished.

4. New Pension System (NPS) to continue the Exempt-Exempt- Taxed (EET).

5. Commodity Transaction Tax (CTT) to be abolished.

These are very good and and daring steps which will help tax payer to reduce tax burden from his pocket. I want to give a clarity on fine line mentioned in budget which will help you to realise how your tax payments will burn deep whole in your pockets.

I just went thought fine line in FBT ( Fringe Benefit Tax ):

FBT is removed and in place of it now your take home plus other benefits receivable are carried in to your net income, all the benefits received house allowance, company cell phone bill, any personal conveyance, any benefit provided by company, even food coupons and expense on those benefits will be part your net income and must be deducted at the source that is your company must deduct the tax from the every rupee they pay you plus they expense on you apart from your salary, its a simple example where your pockets will burn deep with this you must pay more now than before.

Lets take a simple math where a person's CTC is Rs. 5,00,000, and net is around Rs. 4,00,000 in existing context Tax payable amount is on Rs. 4,00,000.
so assuming 80C deduction of Rs. 1,00,000 and Rs. 1,50,000 is tax exempted. this come around

Previous regime

CTC________________________________Rs. 5,00,000

Net taxable___________________________Rs. 3,00,000 (4,00,000 - 1,00,000)

Tax upto 1,50,000______________________ Nil

Above Tax upto 3,00,000________________Rs. 15,000

Upto 4,00,000__________________________Rs. 20,000

Total Tax_____________________________Rs. 35,000



Present regime

CTC__________________________________Rs. 5,00,000

Net taxable_____________________________Rs. 4,00,000(5,00,00 - 1,00,000)

Tax upto 1,60,000________________________Nil

Above Tax upto 3,00,000__________________Rs. 14,000

Upto 4,00,000___________________________Rs. 40,000

Total Tax_______________________________Rs. 54,000


The difference in both the taxes is 20,000, so this year onwards get ready pay more tax than what you get actually. This is the basic way to rob working class in a legal way.

Enjoy for misuse of voting power.