The Finance Minister has increased the surcharge on income above Rs 1 crore, from 12% to 15%. This means that the super-rich would pay approximately 1% more income tax as their effective tax rate increases from 34.6% to 35.6%. This will result in an additional cash outflow of approximately Rs 1 lakh per annum.
also announced tax on dividend income. Currently, dividend income is completely
tax exempt in the hands of the shareholders as the company distributing the
dividends has to pay a dividend distribution tax. FM has proposed to introduce Section 115BBDA to provide for 10%
income tax on gross amount of dividends for taxpayers whose annual dividend
income exceeds Rs 10 lakh.