The Upper House also passed the Anti Hijacking Bill, 2014. The Bill replaces the Anit Hijacking Act of 1982 and redefines hijacking. The Bill also awards death penalty for hijacking in certain cases.

Lok Sabha took up discussion on the Finance Bill.

The Finance Bill proposes several tax changes. Some of which are given below:

Income Tax

Surcharge: The surcharge levied on income tax is proposed to be increased from 12% to 15% for individuals whose annual income exceeds Rs 1 crore. The tax slabs for calculation of income have remained the same.

Rebate: Currently, an individual with income up to Rs 5 lakh can get a rebate of 100% on the income tax payable. However, the rebate amount is capped at Rs 2,000. This cap is proposed to be increased to Rs 5,000.

House rent deduction: Limit of income tax deduction that can be claimed on house rent payment is proposed to be raised from Rs 24,000 per annum to Rs 60,000. This would be applicable to persons who live in rented houses and whose employers do not provide house rent allowance benefits.

Corporate Tax

Currently, the income tax applicable for companies is 30% of their annual income. The Bill proposes that, in case of a domestic company, the rate of income tax would be 29% if the total turnover in the previous year (2014-15) does not exceed Rs 5 crore. The tax will remain at 30% for all other cases.

 New manufacturing companies incorporated on or after March 1, 2016 are proposed to be given an option to be taxed at the rate of 25%, provided they do not claim certain deductions.

The Finance Bill also includes certain legislative changes. The Finance Bill, 2016 proposes to amend the Reserve Bank of India Act, 1934 to establish a Monetary Policy Committee. The Monetary Policy Committee will determine the policy rate required to achieve the country’s inflation target.

Further, the Finance Bill also includes provisions that amend the Foreign Contribution (Regulation) Act (FCRA), 2010. This Act regulates the acceptance of foreign contributions to individuals or companies.

During the debate, members challenged the inclusion of these legislative proposals within the ambit of the Finance Bill, which is a money bill.  Money Bills only require passage in the Lok Sabha.

Lok Sabha was sitting at the time of sending this diary. 

Trina Roy
PRS Legislative Research