Finance Minister Nirmala Sitharaman did not rule out tax sops to the salaried tax-payers in the July 2024 full-year Budget, assuming the Narendra Modi-led government is voted back to power.
Responding to Network18 Editor-in-chief Rahul Joshi’s question on whether the salaried class could be more hopeful in the July Budget about potential reduction in tax rates, “I am not saying anything right now,” she said. Interim Budget 2024 announced on February 1 left tax rates and slabs unchanged in an election year.
Also read: India's systemic reforms are bearing fruit: FM Sitharaman to Network18
When pointed out that the highest personal income tax rate is 30 percent for individuals while the corporate tax rate is 22 percent, and therefore, whether salaried employees could hope, in the longer-term, that the rates will align, she said that direct tax reforms were a “steady job in the pipeline.” Sitharaman added: “Some results have come out and more work is happening.”
In addition, the government is working on ensuring ease of tax-payer facilitation, which needs to be improved. “One aspect of 'serving the tax-payers' happened yesterday, but more work can always be done,” she said, referring to the government’s decision to withdraw ‘petty’ tax demands amounting to up to Rs 25,000.
Also read: Govt to give up on Rs 3,500 crore-worth disputed direct tax demands: Revenue Secretary
During her Budget speech on February 1, Sitharaman had stated her intent to reduce such disputes related to non-verified, petty, direct tax demands, some of which have been in litigation since 1962.
Such outstanding direct tax demands entailing amounts of less than Rs 25,000 pertaining to the period up to 2009-10 are set to be waived off.
Also, outstanding demands of up to Rs 10,000 would be waived off for disputes linked to financial years 2010-11 to 2014-15. The move is expected to benefit around 1 crore taxpayers, she said during her speech.
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