Big Bonanza! Piyush Goyal announces no income tax up to Rs 5 lakh

Amid the speculations about raising the income tax exemption, the salaried class was eagerly watching budget 2019 for some relief. However, they got more than what they were expecting. The finance minister Piyush Goyal announced to raise the income tax exemption slab from Rs 2.5 lakh to Rs 5 lakh. Speaking on the matter Gagan Randev, National Director, Capital Markets and Investment Services, Colliers International India said, “The decision to fully exempt tax for Individuals upto 5 Lakhs  (effectively 6.5 lakhs with Investment deductions) is a big step and massively positive for first time home buyers. With the benefits of the PMAY scheme, this would spur a lot of people sitting on the fence of thinking about their first home”.

Joe Verghese, Managing Director, Colliers International India said, “Proposal to give tax rebate for income up to 5 lakhs will help in increasing the home buyer's budget and can provide a big boost in increasing demand for housing.”

Shilpi Agarwal, Partner, TASS Advisors said, "Individual taxpayers having annual taxable income upto 5 lakh to get full tax rebate. So if a person has made an investment of Rs. 150000 under section 80C and now the exemption limit of Rs. 500000. He would not have to pay any tax upto Rs. 650000 of his income. This would benefit the lower and middle class tax payers."

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The salaried class cheer the announcement as they will have enough fund to invest and hence both equity and mutual fund can expect pumping of money into the market enhancing the liquidity to a larget extent. It may also spike the rise in home buyers leading to rise in residential real estate sector.

Experts from Deloitte India said, "5 lakh exemption proposed is a huge benefit extended to small taxpayers and is likely to spur domestic consumption. Government recognizes for the first time  that 5 L income per annum is in effect the subsistence limit for a good life and should not be taxed."

Joe Verghese, Managing Director, Colliers International India said, 

“Proposal to give tax rebate for income up to 5 lakhs will help in increasing the home buyer's budget and can provide a big boost in increasing demand for housing.”