income tax rates should be reduced as a relief due to overall higher GST rates
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In GST regime, some of daily household goods are at same price and some are marginally increased but there is huge impact due to restaurant and service sectors. The overall impact due to GST in common person expenses would be around 10-15%. By GST reforms, govt indirect tax collection may increase by 20-25% as more businessman will come into tax brackets and they may show their real turnover. Since govt will earn more from indirect tax so in lieu of that govt may reduce income tax liability. So that all the citizen have more money for the consumption and also they can save for future. Govt should reduce income tax in such a way that highest tax payer should get 10-15% reduction. This reduction in tax will increase tax payers base and people will pay tax honestly.
So this is the way govt should change the tax slab from FY 2018-19
Income till 3 Lakh- Nil
From 3 lakhs to 5 lakhs- 5%
Income below 5 Lakhs should be given extra tax rebate of Rs 2500.
5Lakhs to 10 Lakhs--15%
10 Lakhs and above -25%
As business having below 50 crore income are in 25% tax bracket, most of the individual income tax payer are below 50 crores so for them maximum tax liablity should be 25%
Surcharge- 10%, 15% as usual on 50 Lakhs and 1 crore
Cess- 3% as usual.
This will reduce 20% tax for higher income group and below 5 lakhs, there will be a reduction of 35%. so finance minister should implement this.
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