New Delhi: At a stage when the Finance Minister is looking for a way to increase revenues, the assembly results in the five states have left Pranab Mukherjee with a lot of thinking to do.
But amidst all this there is a strong possibility of the tax payers being given relief by a raise in I-T exemption limit. Finance Minister may announce Direct Tax Code (DTC) in the union budget on March 16.  

The tax limit could be raised to Rs 3 lakh and the investment limit for
Tax savings schemes could be hiked to Rs 2.5 lakh. These two options have already been suggested in DTC.

The DTC Bill, which seeks to modernise the direct tax structure in the country, was referred to the Parliamentary Committee in August 2010.

The government, pending approval of the DTC Bill by Parliament, is likely to introduce some measures concerning taxes in the forthcoming Budget itself to be presented by Finance Minister Pranab Mukherjee in the Lok Sabha.

The Finance Minister is under immense pressure to increase direct tax revenue. In the current FY income-tax and corporate tax revenue has witnessed a sharp decline. Finance Minister had set a target of Rs 6,64,457 crore tax revenue collection in the current FY. But till January 2012, the government has been able to collect only Rs 4,58,567 crore which is just 69 percent of the annual target.

Out of the target for tax revenue, the Finance Minister had targeted to collect Rs 5,32,641 crore through direct tax collection. But economic slowdown has affected the corporate tax collection. Till January 2012, out of the target for corporate tax of Rs 3,59,990 the government has been successful in collecting only Rs 2,28,750 crore.  Similarly target for income tax revenue was set at 1,72,026 crore. But Rs 1,14,350 crore has been collected till January 2012.