Business Daily from THE HINDU group of publications
Friday, Aug 22, 2008
ePaper | Mobile/PDA Version | Audio
Business Daily from THE HINDU group of publications Friday, Aug 22, 2008 ePaper | Mobile/PDA Version | Audio |
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Industry & Economy
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Economy Web Extras - Income Tax rules CBDT pegs cost inflation index for 2008-09 at 582 K.R.Srivats New Delhi, Aug 21 The Central Board of Direct Taxes (CBDT) has pegged the cost inflation index for the financial year 2008-09 at ‘582’. This index is useful for income-tax assessees in the computation of tax on long-term capital gains (for indexation purposes). For the financial year 2007-08 and 2006-07, the Finance Ministry had pegged the cost inflation index at ‘551’ and ‘519’. The base year for the cost inflation index is 1981-82 (100). Currently, the income tax law allows long-term capital gains to be computed after adjusting for inflation. The cost of acquisition as well as the cost of improvement is adjusted for inflation between the date of purchases and date of sale (through the cost inflation index) before the long-term capital gain is ascertained.
The income tax law requires the CBDT to specify the cost inflation index for a financial year after factoring in 75 per cent of average rise in consumer price index for urban non-manual employees for the immediately preceding financial year. More Stories on : Economy | Income Tax | Income Tax rules
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