·Threshold limit of exemption from personal income tax in the case of all assesses increased to Rs. 150,000. The slabs and rates of tax are:
Up to Rs. 150,000
Rs. 150,001 to Rs. 300,000
Rs. 300,001 to Rs. 500,000
Rs. 500,001 and above
·In case of a woman assessee, the threshold limit increased from Rs. 145,000 to Rs. 180,000; for a senior citizen, the threshold limit increased from Rs. 195,000 to Rs. 225,000.
·No change in the corporate income tax rates.
·No change in the rate of surcharge.
·Senior Citizen Saving Scheme 2004 and the Post Office Time Deposit Account added to the basket of saving instruments under Section 80C of the Income Tax Act.
·Additional deduction of Rs. 15,000 allowed under Section 80D to an individual paying medical insurance premium of his/her parent or parents.
·Income Tax Act to be amended to provide that reverse mortgage would not amount to "transfer"; and the stream of revenue received by the senior citizen would not be "income".
·Tax income arising from saplings or seedlings grown in a nursery exempted.
·Business of production of seeds and manufacture of agricultural implements added to the list of companies allowed weighted deduction of 150 percent in any expenditure on in-house scientific research.
·Benefit of amortization of certain preliminary expenses under Section 35D allowed to assessees in the services sector.
·Corporate debt instruments issued in demat form and listed on recognized stock exchanges exempted from TDS.
·Creche facilities, sponsorship of an employee-sportsperson, organizing sports events for employees and guest houses excluded from the purview of FBT.
·Parent Company shall be allowed to set off the dividend received from its subsidiary company against dividend distributed by the parent company; provided that the dividend received has suffered DDT and the parent company is not a subsidiary of another company.
· Insert a new sub-section (11C) in Section 80-IB to grant a five year tax holiday to hospitals located in any place outside the urban agglomerations especially in tier-2 and tier-3 towns; this window will be open for the period April 1, 2008 to March 31, 2013.
·Five Year holiday from the income tax being granted to two, three, or four star hotels established in specified districts having UNESCO-declared ‘World Heritage Sites’; the hotel should be constructed start functioning during the period April 1, 2008 to March 31, 2013.
·Coir Board included in Section 10(29A) and exempted from the income tax.
·Rate of Tax on short term capital gain under section 111A & Section 115AD increased to 15 percent.
·STT paid to be treated like any other deductible expenditure against business income; Levy of STT, in the case of options to be only on premium, where the option is not exercised; liability to be on the seller; where the option is exercised, levy to be on the settlement price and the liability on the buyer; no change in the present rates.
·Commodities Transaction tax (CTT) to be introduced on the same lines as STT on options and futures.
·Law being amended to exclude entities carrying on regular trade, commerce or business or providing services in relation to any trade, commerce or business and earning incomes from claiming that their purposes also fall under "charitable purpose". Genuine charitable organizations not to be affected in any way.
·Banking Cash Transaction Tax (BCTT) being withdrawn with effect from April 1, 2009.
CST and a Roadmap towards GST
·Central Sales Tax rate being reduced from 3 percent to 2 percent from April 1, 2008.
·Roadmap for Goods and Service Tax being prepared for introduction of GST from April 1, 2010.