rishiassudani24 asks I am a student and I earn 12000 a month as an income from which I pay for my fees and use as pocket money. Do I need to do anything for income tax?

Pandey says the answer to the question will depend on the source from which you are getting the income. If you are a salaried employee then you will be entitled to standard deduction. After that the question of paying income tax would come. If the income from securities etc then you will be entitled to a deduction up to Rs 12000 under section 80 L. If you are contributing to PPF and insurance then you will get benefit under section 88 also.

muralikrishnars asks India's composition of tax revenues, unlike any other economy in the West Asia, as I understand, is skewed towards indirect taxes. The number of assesses who are having income over 5 lacs (as per the IT records) are also not proportionate to the growing

Pandey says It is true that revenue from indirect taxes is more than direct taxes. But the gap is narrowing down gradually. The number of taxpayers are less because of various reasons one important being exclusion of agricultural income from income tax.

muralikrishnars asks If any tax concessions (like rebates and deductions) are given with the long term perspective, should not the government stand committed to it? For instance people who have very high life insurance premium obligations (taken initially for saving tax).

Pandey says the long term saving majors are there in the income tax act like contribution of insurance premium provident funds, national saving certificates etc. it would be an unfair advantage if single premium paid for policies of higher value are allowed a deduction as it can lead to avoidance of tax.

nddhingra1970 asks Do we expect any increase in ceiling limit or rate structure

Pandey says the ceiling limits can be increased up to Rs one lakh as presently the tax payable above Rs 50000 is being rebated. This is an unnecessary complication and can be done away with.

mehraforms asks How vat will improve of economy?

Pandey says a detailed reply is required for answering this question, which is not possible to do in this chatting.

anu_jade asks If I have opened a PPF account at a time when it was generating about 13% returns, why am I not getting the same now. What forces the government to change its stance in such cases?

Pandey says when general rates of interests globally and in India are falling, the PPF interest rate has to move with this trend.

ganeshac asks Sir, Don’t you think the Finance Minister and his team from NIFPF is obsessed with Service Tax which is killing the middle class at large. Can there be any remedy from this....

Pandey says services constitute a major portion nearly 50% of GDP and it is just and fair that they too contribute to the revenue of the govt like persons engaged in trade and industries.

ganeshac asks Sir, Don’t you think the Finance Minister and his team from NIFPF is obsessed with Service Tax which is killing the middle class at large. Can there be any remedy from this....

Pandey says services constitute a major portion nearly 50% of GDP and it is just and fair that they too contribute to the revenue of the govt like persons engaged in trade and industries.

pratap_2001 asks Sir Is budget is good for share market, whether stock market will rise up to 6800 level?

Pandey says this is a hypothetical question and cannot be replied to unless the budget proposals are known.

ganeshac asks Sir, Do you expect transaction tax to be hiked further in the Budget? What impact will it have on market if it is increased further?

Pandey says Newspaper reports indicate that there is thinking in the govt about the rates of turn over tax. In what shape it would finally emerge can only be conjecture at this stage.

rama_swamy007 asks what measures are needed to improve our tax :GDP ratio and how the forthcoming budget is going to address the same

Pandey says briefly the measure could be 1: increase the tax base substantially to bring agricultural sector in the net of income tax and wealth tax, monitor compliance to tax laws forcefully, punish evaders and black marketers forcefully, educate public about the need for making honest compliance to tax laws and finally the politicians should project an image that tax payer's money is being usefully employed and not wasted on ostentious and useless expenditure.

fransis_muthu asks A move to ASEAN level duty structure, will it spur export and investments, your views please. thanks

Pandey says Mere restructuring of duty structure will not do. a consolidated view regarding the conditions prevailing in Asian countries will have to be taken into account before changing duty structure.

anu_jade asks Agreed, interest rates have to be moving in tandem with the globe. I just want to know if I will be able to make the 13% from PPF, as I had opened the account a long time back.

Pandey says You will have to reconcile with the prevailing rate and not bank on historical rate of 13%.

supriya_fun asks The FRBM Act envisages reducing revenue deficit by at least 0.5 per cent of GDP and cutting fiscal deficit by 0.3 per cent annually Sticking to the FRBM schedule would mean the Finance Minister must walk the tight-rope of controlling expenditure and augment.

Pandey says there is no escape from what you have said if fiscal deficit is to be brought down.

anu_jade asks When the country speaks about equal opportunities, why is there a difference in Standard Deduction for men and women?

Pandey says There is no difference in the standard deduction for men and women now as far as i can recollect.

nddhingra1970 asks In present scenario Government is looking for new areas to Collect Taxes,by the way of Service Taxes. An entrepreneur can save something but is there any thing for General Public.

Pandey says The question is not clear as to what the queries wish to convey.

lakshmi_nara20 asks Do you think tax reforms are a major concern as finance ministry finds difficult to curb expenditure after beyond a point

Pandey says the two issues relating to tax reforms and cutting down exp are not coorelated. Both have to be tackled separately.

johnniey asks Hello Sir, I am a salaried individual having gross income of 5.84 lacs per annum. I have already invested in LIC policies to the tune of 50000. But I think I should not invest under Sec 88 anymore since I would not get the rebate anyhow. Please suggest

Pandey says Rebate under sec 88 is available up to a limit of Rs 70,000. Beyond that benefit of another Rs 30,000 can be availed of for sec 88 benefits by investing in infrastructure securities subject to income limits and rates laid down in sec 88.

vivek_7000 asks the finance ministry targeted a 40%growth in tax collections but had only 20% achieved, what factors can be attributed to this ?

Pandey says There could be many reasons for shortfall in collections which it is not possible mention in this chatting because of constraint of time.

yogi_funny asks whether the budget will do away with sops on housing and insurance/pension schemes?

Pandey says It should not because such concession confer socio economic benefits.

suresh_wb asks Sir, How many items more in the row for Service Tax Net

Pandey says It cant be anybody guess. However looking to the past trends, some more services is bound to be brought in the net of the service tax.

nddhingra1970 asks Sir,is there any chance to increase the limit of Compulsory Audit u/s 44AB

Pandey says Logically the limit should be increased as the same was fixed more than 10 years back. However, a consolidated view needs to be taken in respect of various other monetary limits also prescribed under the IT act and not merely the limit under sec 44AB.

suresh_wb asks What would be the Basic Exemption Limit in respect of Personal Income tax on Individuals & What about One -By - Six scheme

Pandey says As mentioned in earlier reply, the limit should be raised to Rs 1 lac. As far as 1/6 scheme is concerned it should go as it has only led to considerable infractuous work.

pankaj7pn asks Is there any change expected in the exemption of IT exemption for investment in housing sector

Pandey says In my view the present limit is quite liberal and there does not seem to be any case for increasing it.

armilu asks Sir, don’t you think the tax holidays given to the software and other industries should be considered at par with the subsidies given to food and agriculture industry and the govt should take measures to do away with the tax holidays also like the subsidy.

Pandey says The tax holidays are already being phased out as could be seen from the previous finance acts.

tarun_jain2004 asks In your view whether we need to provide an Accelerated depreciation allowance for R&D

Pandey says Weighted deduction for R & D is already there in the IT act.

padmini_abc asks is it high time that we provide simple procedures and tax concessions on M&As (mergers)

Pandey says Simplicity in procedure is always welcome. However in certain situations under the tax laws this may not always be feasible.