Income tax exemption limit raised to Rs 2 lakh

                                                             
The Finance minister has raised the income-tax exemption limit to Rs 2 lakh from Rs 1,80,000. No tax will be charged for income upto Rs 2 lakh. A tax of 10% will be charged for income between Rs 2-5 lakh, while 20% will be charged for income between 5-10 lakh and 30% will be charged above 10 lakh. Th e finance minister has however left the corporate tax unchanged.
Tax slab
Up to 2 lakh rupees - NIL
2 lakh - 5 lakh rupees - 10%
5 lakh - 10 lakh rupees - 20%
Above 10 lakh rupees - 30%
Presenting Budget 2012-13, Finance minister Pranab Mukherjee has said that it is time to take hard decisions and reforms. Mukherjee said that he expects inflation to moderate in the next three months. He also said that India's manufacturing sector is on the path of revival. Mukherjee expects India to grow at 7.6% in 2012-13.

Finance minister Pranab Mukherjee said the growth of the Indian economy estimated at 6.9 percent during this fiscal year was "disappointing". "The global crisis has affected us. India's gross domestic product (GDP) is expected to grow at 6.9% in 2011-12, after having grown at 8.4% in each of the two preceding years," the finance minister said. "Though we have been able to limit the adverse impact of the slowdown in our economy, this year's performance has been disappointing. But it is also a fact that in any cross-country comparison, India still remains among the front-runners in economic growth."
Mukherjee further said the Indian economy was on the threshold of revival, as agriculture and services have continued to grow at a decent pace. He was however unhappy with the performance of the industrial sector.
"While we do not have the aggregate figures for the last quarter of 2011-12, numerous indicators pertaining to this period suggest that the economy is now turning around. There are signs of recovery in coal, fertiliser, cement and electricity sectors."
Among the proposals, the finance minister assured that he would cut subsidies to no more that 2 percent of GDP, and that the policy now would be to directly transfer such doles to farmers, based on the recommendations of the Nandan Nilekani report.
He also assured that a network necessary for a uniform pan-India goods and services tax (GST), covering federal and state levies, would be ready by August this year and that the process will be expedited to introduce it as soon as possible.
He said the government was also examining the recommendations of a parliament panel on the Direct Tax Code and that this regime will be introduced soon.
The finance minister said it was  the government's objective to reform and simplify norms governing capital markets, in a bid to enthuse and improve the investment  climate in the country.