| ITEM | WHAT IT IS NOW | WHAT CHIDAMBARAM PROPOSES | IMPACT |
| Income tax slabs and rates* | Rs 1.1 lakh: Nil Rs 1.1-1.5 lakh: 10% Rs 1.5-2.5 lakh: 20% Above Rs 2.5 lakh: 30% | Raise slabs Raise exemption | + + |
| Service tax | 12% tax on 100-odd services plus a 1% surcharge | Increase tax rate Add new services | - - |
| Education cess | 3% of the income tax payable | Reduce cess Increase cess | + - |
| Surcharge | 10% on tax if income exceeds Rs 10 lakh a year | Reduce surcharge Raise threshold | + + |
| Tax exemptions | Tax deduction of Rs 1 lakh in a year under Section 80C | Raise exemption limit Status quo | + Neutral |
| Home loan | Home loan interest of Rs 1.5 lakh a year is deductible from income | Raise exemption limit Remove tax exemption | + _ |
| Capital gains | Equity investments taxed at lower rate than other capital assets | Raise tax rate for equities Reduce rate for other assets | _ + |
| BCTT (Banking cash transaction tax) | 0.1% tax on cash withdrawals of over Rs 25,000 in a day | Remove tax Status quo | + Neutral |
| Dividend distribution tax | Debt-based funds pay a tax on dividend, paring investors’ gains | Remove tax Extend it to equity funds | + — |
| FBT (Fringe benefits tax) | Employers are taxed for perks (or fringe benefits) given to employees | Remove/reduce tax Add more benefits to list | + — |
| * For male taxpayers. For females, tax-free exemption limit is Rs 1.45 lakh and for senior citizens it is Rs 1.95 lakh | |||
