It is widely expected that basic income tax exemption may go up from the current Rs 2.5 lakh per annum in order to help put more disposable income in the taxpayer’s hands.
Finance Minister Nirmala Sitharaman holds budget papers during a photo opportunity as she leaves her office to present the federal budget in the parliament in New Delhi. (Image Reuters)
The Union Budget 2020, scheduled to be announced at 11am on February 1, is perhaps one of the most critical budgets for India as it comes at a time when the country is grappling with the problem of slowing economic growth, unemployment and consumption slowdown. Finance minister Nirmala Sitharaman, in her second budget presentation for the Narendra Modi government, would be expected to put the economy back on track by increasing spending and boosting demand. Here are the five major announcements that India can expect from the Union Budget 2020:
1. Income tax relief: It is widely expected that basic income tax exemption may go up from the current Rs 2.5 lakh per annum in order to help put more disposable income in the taxpayer’s hands. The current income tax slabs might be revised as well.
2. Deductions under Section 80C, which is most commonly used by salaried taxpayers, might be increased to a minimum of Rs 2 lakh from the current Rs 1.5 lakh in order to encourage investments and savings. Notably, the current limit has anyways not been revised since the last five years.
3. Standard deduction might also be revised upwards to at least Rs 1 lakh from the current Rs 50,000 for salaried individuals.
4. Long-term capital gains (LTCG) tax is also expected to be removed this time in order to improve investor sentiment and drive flows into the capital markets.
5. Last year, the government had provided a Rs 1.5 lakh tax exemption for affordable houses which cost below Rs 45 lakh. That limit is expected to be raised to Rs 75 lakh this year, keeping in mind the real estate prices in metro cities.
Get the best of News18 delivered to your inbox – subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what’s happening in the world around you – in real time.
Source: News18