Income-tax rates and withholding rules revised, setting slab-based tax, surcharges and agricultural income computation framework.

First Schedule of the Finance Act, 2008 prescribes slab-based income-tax rates for individuals (with distinct scales for women and senior citizens), fixed rates for co-operative societies, firms, local authorities and companies, and surcharge mechanisms that increase tax where income exceeds statutory thresholds while limiting total tax plus surcharge relative to threshold income. It also sets withholding rates for various payments to residents and non-residents, specifies surcharge on TDS above thresholds, and detailed rules for computing net agricultural income including special treatment for tea, rubber and coffee and loss set-off provisions.

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