Search:



The Web

Rediff








Home > Business > Special


What if Kelkar proposals are accepted

BS Economy Bureau in New Delhi | July 29, 2004

So what happens if the Kelkar tax proposals II are accepted and implemented by the government? Check out what happens to income tax, customs duties and excise duties. 

PERSONAL INCOME TAX

Income level ------------------ Rate

Below Rs 1 lakh -----------------Nil
Rs 1-4 lakh ---------------20% in excess of income over Rs 1 lakh
Over Rs 4 lakh -----------Rs 60,000 plus 30% of income in excess of Rs 4 lakh

  • Tax rebate and deductions under Section 88, 80L, and 80CCC to be eliminated
  • Eliminate all exemptions, do away with standard deduction

CORPORATE TAX

  • Rate to be cut to 30% from 35.875%
  • Cut depreciation rate for plant and machinery to 15% from 25%
  • Continue with exemption on long-term capital gains on equity
  • Dividend distribution tax by a company to continue at 12.5%

CUSTOMS DUTY

  • Basic Customs duty to be cut to a three-rate structure of 5%, 8% and 10% (raw materials 5%, intermediate goods 8% and finished goods 10%) consumer durables 20%, motor vehicles 50%, specified agricultural products and demerit goods 150%, crude oil 5%, petroleum products 10%
  • EXCISE DUTIES

    • A new goods and service tax (GST) regime proposed, tax incidence of 20%
    • States to be allowed to tax all services concurrently with the Centre
    • Exemption for SSIs to be reduced from Rs 1 crore to Rs 40 lakh
    • Area-based exemptions to be grandfathered

    Also Read:



    Powered by

    More Specials

    Share your comments


     What do you think about the story?




    Read what others have to say:


    Number of User Comments: 8




    Sub: Removing standard deduction is unconstitutional

    Ii is difficult to understand the obsession of Mr. Kelkar with Standard deduction in an otherwise rational report. He seems to be equating standard deduction ...


    Posted by Dhama S Cheta





    Sub: Pay more tax for ministers luxury

    i really get bogged the way Kelkar committee report has tried to burden already suffering middle class population. Even today you end up paying more ...


    Posted by Sandeep Nag





    Sub: What if Kelkar's plan is accepted?

    The problem with Committees like Kelkar's is that they are made up of bureaucrats.The attitude, therefore, whether in income tax or electricity arrears, is to ...


    Posted by jaideep





    Sub: It will be a hell

    All TAX and NO RETURNS... NO DEDUCTIONS... salaried Indians BAD time is coming...


    Posted by Dev





    Sub: Reg-Kelkar Proposal

    Simple! We pay more tax to our government


    Posted by Sundar Raman




    Disclaimer




    Article Tools
    Email this article
    Top emailed links
    Print this article
    Write us a letter
    Discuss this article



    Related Stories


    Kelkar favours more tax reforms

    Budget: Populism at its worst

    Tax issues? Iron out the creases



    People Who Read This Also Read


    Kelkar II report in 2 minutes

    Kelkar II: The fine print

    Kelkar favours more tax reforms







    Copyright © 2005 rediff.com India Limited. All Rights Reserved.