Aggregate amount of Income tax and Surcharge (if applicable) is further subject to 4% ‘Health and Education Cess’ in the case of all types of taxpayers, in respect of AY 2023-24, i.e. all taxpayers are required to pay additional tax @ 4% over and above the amount of Income Tax computed inclusive of Surcharge.
The ‘Health and Education Cess’ is applicable in the case of all type of taxpayers, like AJP, AOP/BOI, Companies (Domestic/Foreign), Cooperative Societies, HUF, Individuals, Local Bodies/Authorities, Partnership Firms (including LLPs), etc. Further, the ‘Health and Education Cess’ is applicable in all types of taxation schemes, i.e. normal tax rates, special tax rates, new or old regimes, inlcuding tax payable under MAT, AMT, etc.
Unlike the surcharge, no marginal relief is permitted in the case of the Health and Education Cess.
It may be noted that the new cess named as “Health and Education Cess” @ 4% has been levied from AY 2019-20, in lieu of “Education Cess” @ 2% and “Secondary and Higher Education Cess” @ 1% which was being levied upto AY 2018-19. In the Budget 2018, Finance Minister Arun Jaitley eliminated the ‘Secondary and Higher Education Cess’ and introduced a 4% ‘Health and Education Cess’.