The Union Budget for fiscal year 2024-25 is set to unveil on 23rd July by the Finance Minister Nirmala Sitaraman and has met with various expectations, especially from the middle class– on the question of income taxes.
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Expectations from the Budget
The Budget is expected to offer some income tax relief for mid to low earners amid inflations in the nation. It is widely believed by the experts that the reduction of income tax will yield positive results as it will help in combating the current economic challengers, as Nirmala Sitaraman will present the new Budget on 23rd July.
The co-founder of CashKaro and EarnKaro, Rohan Bhargava shared with Hindustan Times that they are monitoring the discussions on lowering the income tax and the proposed reforms in proximity for the upcoming budget. He points out that the incumbent 30% tax rate for above RS 15 lakhs earning is quite steep. He, moreover, emphasised over the significance of the jump in tax rates , from Rs 3 lakhs to Rs 15 lakhs and hailed a more gradual increase.
How will it help the Middle Class?
Bhargava proposed that increasing the income threshold for the income to be taxed from Rs 3 to 5 lakhs will be giving individuals, especially the low-income earners, will let them have more disposable income. He believes that this change will significantly boost consumption expenditure, for the middle class- will increase savings and will provide a positive momentum for the e-commerce industry.
Various reports say that the Budget will be prioritizing tax cuts for low earning individuals over traditional welfare spending initiatives, which will boost disposable income and consumption expenditure, stimulating a much wider economic activity. Under the current taxation policy, income tax begins at 5% for earning over Rs 3 lakhs and increases to 30% for incomes over Rs 15 lakhs.
