Tax deduction at source on interest on government securities: rates maintained for 1988-89 with surcharge and specified exemption procedures. Withholding agents must deduct income-tax from interest on Government securities for financial year 1988-89 at the prescribed basic rates and increase the amount of tax deducted by a surcharge for Union purposes applicable to resident Indians and domestic companies. Exemption or abatement certificates already issued and operative for the year should be accepted; new certificates issued after April 1, 1988 govern the rates to be applied. Specific exemptions and a written declaration by resident individuals claiming non-deduction are recognised. Compliance obligations include quoting the Tax-deduction Account Number, timely payment of deducted tax, prescribed returns, rounding rules, and penalties including criminal sanctions for failure to remit deducted tax.