Direct Tax Proposals 2012 : TAX RATES......

Tax Rates

   Individuals, Hindu Undivided Families, Association of Persons and Body of Individuals

Total Income	Present ( FY 2011-12)	Proposed (FY 2012-13)
Upto INR 180,000	NIL	NIL
INR 180,000 to INR   200,000	10%	NIL
INR 200,000 to INR   500,000	10%	10%
INR 500,000 to INR   800,000	20%	20%
INR 800,000 to INR 10,00,000	30%	20%
INR 10,00,001 & Above	30%	30%

v  In the case of a resident individual of the age of sixty years or above but below eighty years, the basic exemption limit is INR 250,000

v  In the case of a resident individual of the age of eighty years or above, the basic exemption limit is INR 500,000

v  Education cess is applicable @ 3% on Income Tax

v  In FY 2011-12, exemption limit for women assessee was INR 190,000 but there is no such preference proposed for FY 2012-13 

    Firm, LLP, AOP, BOI  

There is no change proposed in taxation of above entities. The existing rates are as under:

ü  Taxable @ 30%

ü  No Surcharge

ü  Education cess @ 3% on income tax.   

    Corporate

There is no change proposed in corporate tax rates. The existing rates of corporate taxes are as under: 

Domestic Companies

ü  Taxable @ 30%

ü  Tax rate for Life Insurance companies is 12.5%

ü  Surcharge is applicable @5% if total income exceeds INR 1 crore

ü  Education cess @ 3% on income tax 

Foreign Companies

ü  Taxable @ 40%

ü  Surcharge is applicable @2% if total income exceeds INR 1 crore

ü  Education cess @ 3% income tax 

    Book Profit Based Taxations 

Minimum Alternative Tax (MAT) 

There are no changes in MAT provisions for companies. The existing rates of MAT are as under: 

ü  @ 18.5% of the adjusted book profit (if normal tax is less than 18.5% of book profit)

ü  Surcharge @ 5% is applicable if adjusted book profit is in excess of INR 1 crore.

ü  Education cess is applicable @ 3%. 

Alternative Minimum Tax (AMT) 

AMT is applicable in case of persons other than company. Till FY 2011-12, AMT is applicable only for LLP. Current budget proposals proposed to include Individual, HUF, AOP, BOI in the AMT purview.  

ü  Tax @ 18.5% of the adjusted book profit (if normal tax is less than 18.5% of book profit)

ü  Education cess is applicable @ 3%

ü  AMT will not be applicable for Individual, HUF, AOP, BOI if adjusted total income of such person does not exceeds INR 20,00,000  

    Securities Transaction Tax

Plan to reduce STT in Cash Delivery segment from the existing 0.125% to 0.1%. Details are as under:

Total Income	Present ( FY 2011-12)	Proposed (FY 2012-13)	Payable by
Purchase / Sale of equity shares, Units of equity oriented fund (Delivery based)	0.125%	0.100%	Purchaser / Seller
Sale of equity shares, units of equity oriented mutual fund (non-delivery based)	0.025%	0.025%	Seller
Sale of an option in securities	0.017%	0.017%	Seller
Sale of an option in securities, where option is exercised	0.125%	0.125%	Purchaser
Sale of a futures in securities	0.017%	0.017%	Seller
Sale of a futures in securities	0.250%	0.25%	Seller

 Proposed amendments in the rates of Securities Transaction Tax (STT) will be effective from the 1^st day of July, 2012 

    Wealth Tax 

There are no changes in Wealth Tax rates.  As per existing law, Wealth tax is imposed @ 1 percent on the value of specified assets held by the taxpayer on the valuation date (31 March) in excess of the basic exemption of INR 3,000,000.

    Tonnage Taxation ( For Shipping Company) 

Operating profit of a shipping company is determined on the basis of tonnage capacity of its ships. There are certain changes (w.e.f. 01-04-2012) proposed by finance bill 2012, which is summarised as under:  

Qualifying ship having net tonnage	Existing Rate	Proposed Rate
Up to 1,000	INR 46 for each 100 tons	INR 70 for each 100 tons
1,001 – 10,000	INR 460 plus Rs.35 for each 100 tons exceeding 1,000 tons	INR 700 plus INR 53 for each 100 tons exceeding 1,000 tons
10,001 -  25,000	INR 3,610 plus Rs.28 for each 100 tons exceeding 10,000 tons	INR 5,470 plus INR 42 for each 100 tons exceeding 10,000 tons
Above 25,000	INR 7,810 plus Rs.19 for each 100 tons exceeding 25,000 tons	INR 11,770 plus INR 29 for each 100 tons exceeding 25,000 tons

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