Considering its direct and immediate impact on the people, the tax rate structure naturally occupies centre stage as far as expectations from the Union Budget are concerned.
And this year seems to be no different, as one of the main demands raised by the people in the run-up to the NDA government’s last full Union Budget – which would be presented by Finance Minister Arun Jaitley on 1 February – was increasing the income tax exemption limit and tweaking the tax slabs.
The middle-class salaried professionals demand that the tax levied on their salaries be lowered (or in some cases, even be exempted), considering the rise in cost of living. Meanwhile, for the business community, one of the main grouses has been high corporate tax rate.
There is also the point among some people that rich farmers should be taxed (agricultural income is not taxable in the country).
As Jaitley faces these demands once again this year, BloombergQuint's Pradeep Pandya simplifies the entire matter and explains the challenges before the Finance Minister with the help of an easy-to-relate household analogy.
As per sources, the Finance Ministry is contemplating hiking personal tax exemption limit from the existing Rs 2.5 lakh per annum to Rs 3 lakh, if not Rs 5 lakh, in the upcoming Budget, reported PTI.
There is also speculation that the tax slabs may be tweaked, with the government expected to lower tax rate to 10 percent on income between Rs 5-10 lakh, levy 20 percent for income between Rs 10-20 lakh, and 30 percent for income beyond Rs 20 lakh, the report added.
(With inputs from PTI)
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