LIVE BLOG Union Budget 2024 Income Tax Expectations LIVE: Budget may hike basic exemption limit in new tax regime, change income tax slabs

  Budget 2024 Income Tax Expectations

Finance Minister Nirmala Sitharaman will present the Union Budget 2024 on Tuesday, July 23, 2024. Taxpayers are eagerly awaiting significant tax reliefs from the first Budget of the newly elected government. From hiking the standard deduction limit to tweaking the income tax slabs, taxpayers hope for measures that will ease their financial burden.

Arun Poddar, CEO and Executive Director of Choice International Limited, states, "As we anticipate the Budget 2024, we expect measures that will further propel India's economic growth trajectory. We look forward to initiatives that will bolster the financial ecosystem, including banking, insurance, and capital markets. Some potential adjustments to the tax structure for lower-income brackets could stimulate consumer spending and drive economic momentum, further reinforcing India's growth narrative.”

Sonal Badhan, Economist at Bank of Baroda, says, "As the budget presented on July 23, 2024, will be the first for NDA 3.0, we expect the government to stick to its path of fiscal consolidation without compromising on the quality of expenditure. In the wake of slowing global growth and to maintain momentum in domestic growth, the focus will be on improving rural and urban consumption, savings, and investments. Additionally, we expect this document to reflect the government’s vision for turning India into ‘Viksit Bharat’ by 2047. On the receipt front, certain reductions can be expected if the government decides to relieve the burden of individual taxpayers and give incentives for savings."

 Key Tax Measures Expected by the Common Man in Budget 2024

Increase in Standard Deduction Limit in the New Tax Regime

Experts believe the government may increase the standard deduction limit in the new tax regime, currently set at Rs 50,000. This would leave taxpayers with more disposable income after accounting for deductions. Estimates suggest a moderate hike to Rs 75,000.

Raise the Basic Exemption Limit

Another key expectation is an increase in the basic exemption limit, which currently stands at Rs 3 lakh in the new tax regime. Experts suggest raising it to Rs 5 lakh, offering wider tax relief to all individual taxpayers. Currently, the basic exemption limit is set at Rs 2.5 lakh in the old tax regime.

George Alexander Muthoot, MD of Muthoot Finance, notes, "The forthcoming union budget is poised to chart the course for the new Indian government’s economic growth agenda. On the back of political stability and a resilient economy, it is expected to provide relief to various sections of society and benefits for various sectors."

 Incentives for Affordable Housing

Avneesh Sood, Director of Eros Group, comments, "While industry status for real estate and revived incentives for affordable housing remain key expectations, a nuanced approach is crucial. Beyond fiscal incentives, the budget should focus on enhancing transparency and efficiency through a robust regulatory framework and streamlined approvals process. Introducing innovative financing mechanisms, such as green bonds tailored for sustainable urban development, could align economic growth with environmental stewardship. Moreover, there’s a pressing need to revisit GST input tax credit rules to mitigate cost burdens and bolster market transparency. Emphasising digital infrastructure and smart city initiatives will not only modernize urban living but also attract foreign investment."

Taxpayers and industry experts alike are keenly awaiting the Budget 2024 announcements, hoping for measures that will spur economic growth and provide much-needed financial relief.