The Government proposed to raise the income tax exemption limit from the present 1.6 lakh rupees to 2 lakh rupees.The Cabinet approved the proposed New Direct Tax Code Bill on Thursday. It will replace the existing Income Tax Act, 1961.The Bill also seeks to remove surcharge and cesses on corporate tax, providing relief to business houses. The Bill is expected to be introduced in the Lok Sabha on Monday and is likely to be referred to a Standing Committee. Finance Minister Pranab Mukherjee told reporters after the Cabinet meeting that the whole objective is that a plethora of exemptions will be limited. Income tax slabs will be three. Rate of taxes will be taken in the schedule so that they need not be changed every year. It may be recalled that Finance Minister Pranab Mukherjee had reiterated in his budget speech the commitment to bringing into fore the new Direct Tax Code – DTC – into force from 1st of April next year. AIR correspondent says the new code is aimed at overhauling the existing tax proposals not only for individual tax payers, but also corporate houses and foreign residents.