There are only a few days left for the presentation of the budget for the year 2023 and this time the job profession has the highest expectations from the budget. The Modi government has not made any changes regarding income tax in the last 9 years and this time it is believed that it can pull out all the efforts in the budget.
In this, measures like changing the tax slab and increasing the scope of exemption can be taken. When Finance Minister Nirmala Sitharaman will present the country’s budget next week on February 1, most of the eyes will be on the job profession. Taxpayers have been waiting for a new exemption for a long time and there is scope for changes in the income tax slab as well. Experts believe that this time some big announcements can be made regarding taxpayers.
Most of the conversation is taking place regarding the slabs included in the old regime of income tax. At present, up to 2.5 lakhs, a direct tax exemption is available, while income from 2.5 to 5 lakhs is taxed at the rate of 5%. However, it is returned to the taxpayers. That is, earning up to 5 lakhs becomes completely tax free.
But, as soon as your income goes above 5 lakhs, the tax rate on it directly increases four times to 20 percent. Experts estimate that the maximum number of employed people also fall in this slab. If changes are made here, a large number of people will get relief.
What can happen, the rate
expert estimates that this time the government can add a new slab to the old tax regime along with the change in the new regime. This change will be for taxpayers with income ranging from Rs 5 lakh to Rs 7.5 lakh. It is estimated that the tax rate on this income can be reduced to 10 or 15 percent, which is currently 20 percent. It happens that lakhs of salaried taxpayers will get a big help in saving tax.
Relief even on earning more than 10 lakhs!
Income tax experts say that this time the benefit of tax exemption can be availed not only in the 20 per cent bracket, but also those earning more than 10 lakhs. Currently, income above 10 lakh is directly taxed at 30 per cent. It is being speculated that in this bracket, the slab of 30 per cent can be reduced to 25 per cent. Only a few days are left for the budget to come and this time the most awaited is regarding income tax.
Will the tax exemption limit also increase?
Experts also estimate that this time, along with changing the tax slab, the government can also increase the exemption limit on all types of investments. This includes investment schemes like NPS, PPF and ELSS. Tax exemption on PPF and increasing the investment limit to Rs 3 lakh are being speculated, which is currently only Rs 1.5 lakh annually.