Budget 2023 | If Finance Minister Nirmala Sitharaman really gives ‘this’ discount, how much will be the benefit? G

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Some experts say that the priority before the government will be how to reduce the fiscal deficit. According to some economists, the government plans to limit the country’s deficit to 5.9 percent of the gross national income in the new financial year.

New Delhi: The common man of the country i.e. the middle class and the lower middle class, have high expectations from the budget (Budget 2023) every year. In income tax, he is paying attention to whether there will be any exemption in income tax. In order to get full exemption from income tax, the annual income requirement is 2.5 lakh rupees. If the annual income is more than that, you have to pay tax on your income. But if the taxable income after all calculation is less than five lakhs then the income is tax free by giving exemption under 87A of Income Tax Act. But one whose taxable annual income is more than 5 lakhs has to pay tax. It is precisely this class that expects the tax-free income limit from the budget to exceed two and a half lakhs every year. But till now this dream of tax payers has remained a day dream.

Will the limit of tax free income increase this year?
This year too, as usual, economists are hopeful that the tax-free income limit will increase to 5 lakhs. There are some who believe that it will happen this year. Union Finance Minister Nirmala Sitharaman will present the budget in Parliament on February 1, 2023. Many people are hoping that this budget will increase the tax-free income of common people up to 5 lakhs. It is estimated that there will be some announcements in this budget that will give relief to the common man, and there will be major announcements regarding infrastructure facilities.

Possibility of increasing exemptions for taxpayers
The basic exemption to be given to individual taxpayers is expected to be increased from 2.5 lakhs to 5 lakhs. This means the category with annual income less than 5 lakhs will not have to pay income tax. They are also likely to be exempted from filing income tax returns. Since no change has been made in this suite since 2014-15, it is predicted that this change will happen this time.

What will be the benefit if that happens?
If this is actually announced, a taxpayer with an income of Rs 5 lakh or above is likely to save Rs 13 thousand per year in combined Income Tax and Education Cess.

Currently, those whose income is more than 2.5 lakh rupees and less than 5 lakh rupees do not have to pay any tax. Because they get exemption under Section 87A of Income Tax. Currently only those whose taxable income is more than 5 lakhs have to pay income tax.

Along with this, it is also predicted that the limit of standard deduction will be increased from 50 thousand to 1 lakh rupees in the coming budget. This decision is likely to be taken considering rising inflation, cost of living.

If this also happens in reality, every tax payer will benefit. Those whose taxable income is Rs 5,50,000 are also likely to start getting benefits under Section 87A. This will save them Rs 23,400 per year. Taxpayers with income above Rs 5,50,000, who fall under the tax bracket of 20 to 30 per cent, will also benefit from the increase in standard deduction. This gain is likely to be 10,400 or 15,600 respectively.

Emphasis on fiscal deficit reduction
Some experts say that the priority before the government will be how to reduce the fiscal deficit. According to some economists, the government plans to limit the country’s deficit to 5.9 percent of the gross national income in the new financial year. The government is likely to increase spending on public welfare while maintaining capital expenditure. It is likely that rural employment, construction of houses will be given more attention.

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