All taxpayers will be relieved in coming fiscal as the Union Cabinet gave a nod to the much-awaited Direct Taxes Code (DTC) Bill according to which the income tax amount to be exempted will be increased to Rs. 2 lakh from the existing Rs. 1.6 lakh.

The Bill also talks of removing the surcharge on corporate tax to provide relief to industry while making simple the taxation norms.

Finance Minister Pranab Mukherjee spoke to the media after the Cabinet where he gave indications that there will be there raise in the basic exemption limit for income tax. The new tax slabs will be discussed in the Parliament.

The indications at present are that an annual income of Rs. 2-5 lakh will have a tax rate of 10 percent applied while the same of Rs. 5-10 lakh will have 20 percent and above Rs. 10 lakh will have 30 percent.

Senior citizens and women will most probably get some additional benefits in tax slabs. DTC Bill is aimed at replacing the archaic Income Tax Act of1961, and to restrict the plethora of exemptions.