A direct tax practitioners’ body has urged the union government to reduce the personal income tax burden on citizens in the upcoming budget later this month.
Budget 2024 Expectations: Income Tax
The president of the All India Federation of Tax Practitioners (AIFTP), Narayan Jain, has called for the exemption limit to be increased to Rs 5 lakh. He stressed the importance of simplifying the tax structure to facilitate easier compliance.
“Incomes between Rs 5 lakh and Rs 10 lakh should be taxed at 10 per cent, those between Rs 10 lakh and Rs 20 lakh at 20 per cent, and incomes above Rs 20 lakh at 25 per cent,” Jain proposed in his memorandum to Finance Minister Nirmala Sitharaman. He also recommended eliminating the surcharge and cess, stating that their continuation is no longer justified.
Jain argued that the government has not adequately explained how the education cess is utilized, highlighting that providing education and medical facilities is a fundamental duty of the government.
The memorandum also addressed the tax rate under section 115BBE on unexplained cash credits, loans, investments, and expenditures, which was raised to 75 per cent plus cess during the demonetization period. Jain advocates for reverting this rate to the original 30 per cent.
Also read: Union Budget 2024: Government May Push for Increased Privatization of PSU Banks
Budget 2024: Standard Deduction
The finance ministry is reportedly considering raising the standard deduction limit for income taxpayers under the new tax regime while leaving the tax exemption-heavy old regime unchanged. The finance minister may consider increasing the standard deduction to up to Rs 1 lakh per annum in the upcoming budget.
Budget 2024 Date
The Union Budget for 2024-25 will be presented on July 23rd, 2024. This will be the full budget following an interim budget presented earlier this year.