Margin Tax Benefit in budget 2009-2010

• In budget 2009-2010 they increased the basic exemption limit for male taxpayers and female taxpayers by Rs 10,000 and that of senior citizens by Rs 15,000. Further, he abolished the surcharge of 10% on income over Rs 10 lakh.

The current income tax exemption limit is Rs 1.5 lakh (Rs 150,000) for men, Rs 1.8 lakh (Rs 180,000) for women and Rs 2.25 lakh (Rs 225,000) for senior citizens.

• Removed the surcharge on income above Rs 10 lakh (Rs 1 million) for personal income tax payers. The surcharge was levied at the rate of 10 per cent on income above Rs 10 lakh.
• The finance minister raised the deduction for maintenance of medical treatment of dependence from Rs 75,000 to Rs 1 lakh
• The finance minister also proposed to introduce Saral-II form to enable the taxpayers to file their returns without difficulty.

The new tax slabs now stand as follows:

For Male taxpayers

0 to 160000	0
160001 to 300000	10%
300001 to 500000	20%
Above 500000	30%

For Female taxpayers

0 to 190000	0
190001 to 300000	10%
300001 to 500000	20%
Above 500000	30%

For Senior citizens

0 to 240000	0
240001 to 300000	10%
300001 to 500000	20%
Above 500000	30%

In addition to this, an education cess of 3% on the tax amount continues while a 10% surcharge on income over Rs 10 lakh has been abolished.

Example:

Taxable income (Rs)

Tax  before budget

Tax after budget

Difference

	Male	Female	Male	Female	Male	Female
200000	5150	2060	4120	1029	1030	1031
500000	56650	53560	55620	52529	1030	1031
1000000	211150	208060	210120	207029	1030	1031
1200000	300245	398815	364619	516029	53046	52736
1500000	402215	568765	519119	670529	68496	68186