Income Tax: Excellent news! The Budget will benefit taxpayers by ₹50,000 extra, as the Modi administration may declare

Income Tax: Excellent news! The Budget will benefit taxpayers by ₹50,000 extra, as the Modi administration may declare

Income Tax: Excellent news! The Budget will benefit taxpayers by ₹50,000 extra, as the Modi administration may declare

The administration may make modest adjustments to the new tax system in Budget 2024 in order to appease the taxpayers. In this, the idea of raising the current tax exemption is being considered. Under the new tax structure, Rs 7 lakh is now free from taxes. It is possible to raise this to Rs 7.5 lakh.

The good news for taxpayers is arrived. The next budget could include some good news for them. The administration will make an effort to win over taxpayers since this is an election year. Thus, there's a good probability that the budget will provide significant relief to taxpayers. The new tax structure might be altered in the Vote on Account budget, which is scheduled to be presented on February 1, if reports are to be believed. It is possible to expand the current tax exemption's scope. For this modification, the government may introduce a new financial bill. It may be introduced in Parliament during the second part of the budget session, if reports are to be believed.

What will alter?

The administration may make modest adjustments to the new tax system in Budget 2024 in order to appease the taxpayers. In this, the idea of raising the current tax exemption is being considered. Under the new tax structure, Rs 7 lakh is now free from taxes. It is possible to raise this to Rs 7.5 lakh. indicating that a further discount of Rs 50,000 may be offered. Prior to this, the government raised the new tax regime's exemption threshold from Rs 5 lakh to Rs 7 lakh. This resulted in an increase in the rebate from Rs 12500 to Rs 25000 under section 87(A).

Income up to Rs 8 lakh will be tax-free.

In the next fiscal year, salaries up to Rs 8 lakh may be exempt from taxes. According to tax experts, the exemption ceiling might reach Rs 8 lakh if the budget includes such a provision. Income up to Rs 7.5 lakh is free from taxation under the existing system. Standard deduction, rebate, and basic exemption are also included in this.

Received the standard deduction gift

Finance Minister Nirmala Sitharaman altered the new tax system in the Union Budget for 2023–2024. The basic exemption amount was raised to Rs 3 lakh from Rs 2.5 lakh in this. Concurrently, the maximum refund amount that was previously accessible was raised to Rs 7 lakh from Rs 5 lakh. In addition to this, the standard deduction advantage was included. Income up to Rs 7.5 lakh was then tax-free. Itself was there. In the new tax system, retirees received an extra Rs 15,000 in rebates.

Will the new tax system undergo quick changes?

Experts predict that in the near future, the new tax system will undergo significant modifications. The government stands to gain from enhancing the appeal of the new tax system, as seen by the unprecedented rise in income tax returns. It will need to have some tax exemption in order to do this. For the assessment year 2023–24, a record 8.18 crore Income Tax Returns (ITR) were submitted till December 31.

significant increase in the collecting of advance taxes

Experts agree that the government need to think about extending tax exemptions. This will have a lot of advantages. Nonetheless, the administration is placing a strong emphasis on raising tax revenue. The total amount of advance tax collected until December 15th in the fiscal year 2023–24 was 19.76 percent more than it was at the same time previous year. Tax revenue for the current fiscal year, which ends on December 15, is Rs 624329 crore, up from Rs 521302 crore the previous year.

The amount of direct taxes collected is rising.

The amount of direct taxes collected up to December 17, 2023, has increased by 20.66 percent over the same time last year. In comparison to the same time last year, direct tax collection was Rs 11,35,754 crore, or Rs 13,70,388 crore.