The Interim Budget 2019 may have more to offer than any of the past interim budgets. Finance Minister Arun Jaitley has asserted that the upcoming interim budget will address the needs of the economy. Ahead of the general elections, the government is expected to lure the middle class, thus offering relief in the personal finance space.
Changes in Basic Exemption Limit
There is widespread expectation that the basic exemption limit of income tax for the general category will be raised from Rs 2.5 lakh to Rs 3 lakh. In that case, the exemption limit for senior and super senior citizens will also be raised.
Currently, for senior citizens (60 years to 80 years), the exemption limit stands at Rs 3 lakh while that for super senior citizens (above 80 years) is Rs 5 lakh. Experts are also hopeful of similar exemptions for women.
Increase in Standard Deduction Limit
In the last budget, the government had re-introduced the standard deduction rule for the salaried class. However, exemptions on conveyance allowance and medical reimbursement were revoked. The standard deduction limit may be raised to Rs 75,000 from the existing Rs 40,000, in this budget.
Exemption Limit Under Section 80C
Industry body CII has urged the government to increase the exemption limit under Section 80C to Rs 2.5 lakh from the existing Rs 1.5 lakh. The move is expected to ramp up savings and investment besides providing tax relief. Savings, life insurance, tuition fees, home loan repayment etc. come under the ambit of Section 80C.
Increase in Exemption Limit on Interest on Home Loans
There are expectations that the exemption limit on interest on home loans will be raised from Rs 2 lakh to Rs 2.5 lakh. The move, if implemented will also prove to be a push for the government’s ‘Housing for All’ pitch.