Interim budget 2024: What to expect for income tax payers

| Updated: 31 January, 2024 9:15 pm IST

NEW DELHI : As Finance Minister Nirmala Sitharaman prepares to present India’s budget ahead of the general elections, many are anticipating changes that might impact ordinary income tax payers. The current income tax slabs for professionals and NRIs in the old tax regime are structured based on income levels. The slabs include no tax for income up to 2.5 lakh, five percent for income between 2.5 lakh and 5 lakh, 20 percent for income between 5 lakh and 10 lakh, and 30 percent for income above 10 lakh.

For the new tax regime in FY 2023-24, the slabs have been adjusted, with no tax for income up to 3 lakh, five percent for income between 3 lakh and 6 lakh, and varying percentages for higher income levels.

However, the anticipation for changes in the upcoming budget may be limited due to the nature of the budget being interim. An interim budget is typically presented when national elections are imminent. Its purpose is to ensure the continuity of government functions and the payment of salaries to government officials during the transition period before the new government takes office.

READ MORE : India aims for $7 trillion economy by 2030: Finance Ministry report

While there is no strict rule preventing the government from making changes to tax slabs or overhauling the income tax regime in an interim budget, the likelihood of such changes is considered slim. Interim budgets are generally viewed as stop-gap arrangements, and significant policy changes are typically deferred until the new government takes office.

As the budget is presented just months before the general elections, the focus may be on maintaining stability rather than introducing major reforms. It is worth noting that significant tax reforms and changes to tax slabs are usually announced in regular budgets rather than interim ones.

While the expectation for major changes in income tax slabs during the interim budget is low, the landscape may evolve after the elections when a new government has the opportunity to present a full-fledged budget for the fiscal year.

Also Read Story

What Kejriwal can do & can’t: Here’s what conditions in SC bail order are…

SC grants interim bail to Kejriwal, but to remain in jail

Rahul Gandhi urges civility towards Smriti Irani following Lok Sabha results

CBI arrests alleged mastermind in NEET-UG paper leak case