Budget 2016: Income Tax Relief Announced For Small Taxpayers

Finance Minister Arun Jaitley has raised the deduction limit under Section 87A of the Income Tax Act from Rs 2,000 to Rs 5,000 per annum. Under Section 87A, taxpayers first reduce Rs 2,000 from their total tax payable. This section applies to those with total income of less than Rs 5 lakh. The finance minister also announced relief for taxpayers who do not own a house and don't get house rent allowance from employers. So far, such taxpayers got a relief of Rs 24,000 per year, which has now been raised to Rs 60,000 per annum under Section 80GG, Mr Jaitley said. The measure will provide "relief to those in rented houses," the finance minister added.