Big Changes Expected in Upcoming Budget. Higher Income Earners Might Get Relief
As the much-anticipated July budget draws near, expectations are soaring. The government is rumored to be considering significant policy changes, including adjustments to the tax system for individuals earning over ₹10 lakh annually. This has been a long-standing demand from the salaried class.
Meetings with Experts and Industry Leaders
Over the past two weeks, Finance Minister Nirmala Sitharaman has held a series of meetings with experts and representatives from various industrial sectors. One of the key issues brought up in these meetings is the need for changes in the income tax slabs for salaried individuals. The argument is that the current tax burden on salaried people is excessively high.
Push for Tax Reduction
Experts have suggested that the government has been providing benefits in other tax areas but has not offered significant relief to lower and middle-income taxpayers. CA Aman Ansari noted that tax collections are steadily increasing, as is the number of individuals filing income tax returns. Thus, there is a strong expectation that the tax rate for those earning above ₹10 lakh annually should be reduced from 30% to 25%.
Current Tax Structure Criticized
Under the old tax system, income above ₹10 lakh is taxed at 30%, which many argue is impractical. Comparatively, the new tax system requires those earning above ₹7 lakh to pay 10% for income between ₹6-9 lakh and 15% for income between ₹9-12 lakh, which is also seen as impractical given the rising costs of living and inflation.
Call for Relief
Given the increased cost of living, many are finding their savings dwindling. Therefore, there is a strong push for tax relief for those earning above ₹10 lakh annually.
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