Reading between the figures

DIRECT TAXES

TAX RATES

The Finance Bill, 2007, has retained tax and surcharge rates. However, secondary and higher education cess of 1 per cent of tax and surcharge has been imposed. No surcharge would be payable by corporates and firms having total taxable income of Rs 1 crore or less.

INCREASE IN THRESHOLD LIMIT FOR INDIVIDUALS

The Bill proposes to increase the threshold limit for individuals, HUF (Hindu Undivided Family) and AOP by Rs 10,000. Consequently, the revised threshold limit for individuals, HUF and AOP would be Rs 110,000, and that for women and senior citizens would be Rs 145,000 and Rs 195,000, respectively. The marginal tax relief on account of above would be largely offset by the increase in education cess. (Paragraph A of Part I)

GAINS ON TRANSFER OF PERSONAL EFFECTS

Presently, gains on transfer of personal effects (excluding jewellery) are not subject to capital gains tax. The Bill proposes to widen the definition of "capital assets" by including personal effects such as archaeological collections, drawings and any work of art, thereby seeking to tax gains on transfer of such personal effects. (Clause 3)

AMENDMENT IN TAXATION ON 'SOURCE' BASIS

The Bill proposes to amend Section 9 of the Income-Tax Act, 1961, (Act) to clarify that income in nature of interest, royalty and fee for technical services would be deemed to accrue or arise in India, and included in the income of a non resident, whether or not such non-resident has a residence, place of business or business connection in India. (Clause 5)

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