Winning Bizness Desk
Mumbai. When Finance Minister Nirmala Sitharaman will present the country's budget next week on February 1, most of the eyes will be on the job profession. Taxpayers have been waiting for a new exemption for themselves for a long time and there is scope for changes in the income tax slab as well. Noted chartered accountant Nagesh Dubey believes that this time some big announcements can be made regarding the taxpayers. Most of the discussions are taking place regarding the slabs included in the old system of income tax. At present, up to 2.5 lakhs, there is a direct tax exemption, while income from 2.5 to 5 lakhs is taxed at the rate of 5%. However, it is returned to the taxpayers. That is, the income up to 5 lakhs becomes completely tax free.
Income tax expert Nagesh Dubey explains that the moment income goes above 5 lakhs, the tax rate on it directly increases four times to 20 percent and maximum number of employed people fall in this slab only. If a change is made here, a large number of people will get relief. This time, along with the change in the new system, the government can also add a new slab to the old tax system. This change may be for taxpayers with income between Rs 5 lakh and Rs 7.5 lakh. "It is estimated that the tax rate on this income can be reduced to 10 or 15 percent, which is currently 20 percent. It happens that lakhs of salaried taxpayers will get a big help in saving tax," said Dubey adding that there are big expectations from the government as this is the last full fledged budget from Modi 2.0 govt.
Other income tax experts say that this time the benefit of tax exemption can be availed not only in the 20 per cent bracket, but also those earning more than Rs 10 lakh. Currently, income above Rs 10 lakh is directly taxed at 30 per cent. It is being speculated that the slab of 30 per cent in this bracket may be reduced to 25 per cent. Only a few days are left for the budget to come and this time the most awaited is regarding income tax.