Income Tax slabs 2024-25: Will Budget 2024 see additional tweaks in the New Tax Regime? Here's what experts want
Budget 2024: FM Sitharaman brought many changes for the middle class in the last Budget, which included an increase in the rebate limit for personal income tax under the new tax regime, a hike standard deduction for salaried professionals and pensioners, revised tax slabs, and others.
- Feb 1, 2024,
- Updated Feb 1, 2024 10:19 AM IST
Budget 2024: Union Finance Minister Nirmala Sitharaman is going to present her sixth consecutive Budget in less than one hour with which she will become only the second Finance Minister in the country to have presented the Union Budget for six consecutive years after Morarji Desai. Different sectors have different expectations from the FM. The top-most demand for middle class is tax tweaks and more deductions in the New Tax Regime.
FM Sitharaman brought many changes for the middle class in the last Budget, which included an increase in the rebate limit for personal income tax under the new tax regime, a hike standard deduction for salaried professionals and pensioners, more funds for education, including scholarships and funding for educational institutions, and others.
So what is expected from FM Sitharaman today?
Here's a wishlist:
1. More tax benefits under New Tax Regime
Akhil Chandna, Partner, Grant Thornton Bharat, said: "The finance minister can announce three tax benefits under the new tax regime in Budget 2024: a) Increase in standard deduction amount, b) Tax incentives for long-term investments, and c) introduction of tax exemptions for certain allowance."
2. Section 80C deductions for New Tax Regime
Preeti Sharma, Partner, Tax & Regulatory Services, BDO India, said a substantial number of taxpayers invest in the instruments that provide tax deductions of up to Rs 1.5 lakh under Section 80C. To increase acceptance of the new tax regime, the government should allow deductions under this regime.
3. Hike standard deduction limit under the new tax regime
Abhishek Soni, CEO, Tax2Win.in., said the government should hike the standard deduction limit under the new tax regime. This would contribute to easing the tax burden on salaried individuals, allowing them to retain more of their hard-earned money.
4. Mediclaim under New Tax Regime
Dr. Suresh Surana, Founder, RSM India, said the concessional tax regime does not provide deduction for mediclaim premium incurred and as such individuals are sceptical about opting for the new regime. Considering that most of the individual taxpayers incur expenditure for the purpose of their medical wellbeing, providing such a deduction would encourage individual taxpayers to opt for the new regime.
5. Lower the highest tax rate
To further enhance the appeal of the New Regime, the Centre should consider to lower the highest tax rate from 30% to 25% and increase the income threshold for this highest rate from Rs 15,00,000 to Rs 20,00,000.
Also read: Budget 2024 LIVE Updates: Three income tax sops could come from FM today. Details inside
Budget 2024: Union Finance Minister Nirmala Sitharaman is going to present her sixth consecutive Budget in less than one hour with which she will become only the second Finance Minister in the country to have presented the Union Budget for six consecutive years after Morarji Desai. Different sectors have different expectations from the FM. The top-most demand for middle class is tax tweaks and more deductions in the New Tax Regime.
FM Sitharaman brought many changes for the middle class in the last Budget, which included an increase in the rebate limit for personal income tax under the new tax regime, a hike standard deduction for salaried professionals and pensioners, more funds for education, including scholarships and funding for educational institutions, and others.
So what is expected from FM Sitharaman today?
Here's a wishlist:
1. More tax benefits under New Tax Regime
Akhil Chandna, Partner, Grant Thornton Bharat, said: "The finance minister can announce three tax benefits under the new tax regime in Budget 2024: a) Increase in standard deduction amount, b) Tax incentives for long-term investments, and c) introduction of tax exemptions for certain allowance."
2. Section 80C deductions for New Tax Regime
Preeti Sharma, Partner, Tax & Regulatory Services, BDO India, said a substantial number of taxpayers invest in the instruments that provide tax deductions of up to Rs 1.5 lakh under Section 80C. To increase acceptance of the new tax regime, the government should allow deductions under this regime.
3. Hike standard deduction limit under the new tax regime
Abhishek Soni, CEO, Tax2Win.in., said the government should hike the standard deduction limit under the new tax regime. This would contribute to easing the tax burden on salaried individuals, allowing them to retain more of their hard-earned money.
4. Mediclaim under New Tax Regime
Dr. Suresh Surana, Founder, RSM India, said the concessional tax regime does not provide deduction for mediclaim premium incurred and as such individuals are sceptical about opting for the new regime. Considering that most of the individual taxpayers incur expenditure for the purpose of their medical wellbeing, providing such a deduction would encourage individual taxpayers to opt for the new regime.
5. Lower the highest tax rate
To further enhance the appeal of the New Regime, the Centre should consider to lower the highest tax rate from 30% to 25% and increase the income threshold for this highest rate from Rs 15,00,000 to Rs 20,00,000.
Also read: Budget 2024 LIVE Updates: Three income tax sops could come from FM today. Details inside