Budget 2024: The country’s next full budget can be presented next month. Like every time, this time too income taxpayers are expecting a lot from the budget.
The Finance Ministry is planning to increase the standard deduction limit on income for taxpayers under the new tax regime. According to the Times of India, there is no possibility of any change in the exemption in the old regime. Let us tell you that this will be the first budget (Budget 2024) of the new term of the NDA government. Earlier, the interim budget was presented on February 1 in view of the recently concluded Lok Sabha elections 2024.
Finance Minister Nirmala Sitharaman has started public consultation regarding the budget. However, most of the discussions will remain within the Finance Ministry. These internal assessments will be reviewed with other government branches and the Prime Minister’s Office before a final decision is taken. In last year’s budget, the finance minister had proposed a standard deduction of Rs 50,000 for salaried taxpayers and pensioners under the new regime. If one does not opt out, it will be implemented by default. Apart from this, the exemption for taxable income up to Rs 7 lakh under section 87A has been increased. The highest surcharge has also been removed under the new regime.
People with taxable income of more than Rs 3 lakh have to pay 5 per cent income tax. Industry leaders have suggested adjusting rates in higher brackets to promote consumption. The increased standard deduction will benefit all salaried taxpayers, including those with higher incomes, despite the potential revenue loss.
Standard deduction limit is Rs 50,000
The standard deduction limit was initially set at Rs 40,000 to help salaried individuals cover medical and transport expenses and was increased to Rs 50,000 in 2019. Considering the current cost of living and inflation, this limit is not considered sufficient. It is expected that it can be increased to at least Rs 1 lakh.
