New Delhi, Aug 26 (PTI) In a move that could leave more money in the hands of people, the Government today proposed to raise exemption limit on income tax from the present Rs 1.6 lakh to Rs 2 lakh.

The Cabinet approved the much-awaited Direct Taxes Code (DTC) Bill, which is likely to be tabled in Parliament during the ongoing Monsoon session and thereafter it may be referred to a select committee of members of both houses of Parliament.

The bill also seeks to remove surcharge and cesses on corporate tax, which could provide relief to business houses.

When asked what will be the limit of exemptions for income tax, Finance Minister Pranab Mukherjee told reporters after the Cabinet meeting that it is proposed to be raised to Rs 2 lakh from the current Rs 1.6 lakh. Tax exemption limit increase under Direct Taxes Code Bill, with proposed removal of corporate surcharge and cesses. The Direct Taxes Code Bill proposes raising the individual income tax exemption threshold and abolishing surcharge and cesses on corporate income tax; the Cabinet has approved the Bill for tabling in Parliament and anticipated referral to a joint select committee for detailed consideration.