The union budget for 2023-24 has been pitched as a budget for India @ 100, and the next 25 years are being called India’s Amrit Kaal.
Here’s a quick take on the key announcements, especially for income taxpayers.
Finance Minister Nirmala Sitharaman provided many incentives for income taxpayers in her budget 2023 speech, especially if you are following the new income tax regime. There were many key changes to the new income tax regime, let’s take a look at them:
The biggest of the incentives is no tax till an annual income of Rs 7 lakh, up from Rs 5 lakh earlier. And then there is the new tax slab structure:
- Nil up to Rs 3 lakh,
- 5% for Rs 3 to 6 lakh,
- 10% for Rs 6 to 9 lakh,
- 15% for 9 to 12 lakh,
- 20% for Rs 12 to 15 lakh and
- 30% for above Rs 15 lakh.
But remember, all these benefits are only if you pay taxes under the new tax regime. These will not be applicable to the old tax regime.
So, if your income is Rs 9 lakh, you will pay a tax of Rs 45,000, down 25% from Rs 60,000 earlier, and if your income is Rs 15 lakh, you pay a tax of Rs 1.5 lakh, down 20% from Rs 1.87 lakh earlier.
Also, to cheer up the salaried class, the finance minister raised the standard deduction to Rs 52,500 from Rs 50,000.
Nirmala Sitharaman also cut the highest surcharge for income tax from 37% to 25% in the new tax regime.
Well, what about those not paying income tax under the new tax regime?
Well, after combing the speech, we could find only a few benefits, including tax exemption on leave encashment being raised from Rs 3 lakh to Rs 25 lakh.
On the other hand tax incentives on certain ULIPs or unit-linked insurance plans have been limited.
Among other measures, Sitharaman announced that an integrated IT portal would be established to reclaim unclaimed shares or debentures. Something to cheer- if you have misplaced some shares from your grandparents.
A new savings scheme for women was also announced which will provide 7.5% annual interest.
Also, if you are a professional then you can take the benefit of presumptive income to Rs 75 lakh annual income. This limit was earlier Rs 50 lakh.
This basically means if your professional income is Rs 75 lakh, you can straightaway offer 50% of the gross revenue as taxable income.
What gets costlier or cheaper?
- Prices of cigarettes are set to rise as a tax on them was raised by 16%.
- Imported kitchen chimneys will get costlier as they will now attract a customs duty of 15%, double from 7.5% earlier.
- Imported jewelry made from gold bars or silver bars will also get costlier.
And what will get cheaper?
Nothing directly actually, as most customs duty relief are for components to help push Make In India
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