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Tax exemption limit in India’s Union Budget 2019 likely to be increased to Rs 3 lakh

Union minister Nirmala Sitharaman with MoS Anurag Thakur at the Parliament. Sketched by the Pan Pacific Agency.

Pan Pacific Agency | COMMUICATION AGENCY FOR PACIFICA REGIONS

NEW DELHI, Jul 5, 2019, Business Today. The Modi 2.0 government’s Union budget 2019 may be all about the middle class people. Union Finance Minister Nirmala Sitharaman’s maiden Budget is expected to bring cheers to the middle class taxpayers by raising basic tax exemption limit to Rs 3 lakh from Rs 2.5 lakh. Reports say Nirmala will announce these sops to provide relief to small taxpayers and to cover inflationary impact. If this announcement is made, then a lot of taxpayers would be affected by the change, reported the Business Today.

In the Interim Budget, then Finance Minister Piyush Goyal had announced income tax rebate for individual taxpayers with taxable annual income up to Rs 5 lakh. However, the BJP government had decided to keep the basic exemption limit unchanged.

Nonetheless, Sitharaman may have other surprises in her budget red bag. Many people also want Sitharaman to increase income tax deduction under Section 80C of the Income Tax Act. The Modi 2.0 government, in order to please honest taxpayers, may also raise tax exemption under Section 80 C of the Income Tax Act to Rs 2 lakh from the current Rs 1.5 lakh, IANS claimed quoting sources, adding that the additional annual saving window of Rs 50,000 under the National Pension Scheme (NPS) will also remain.

For homebuyers, the government will increase the tax deduction limit on interest on home loans to Rs 2.5 lakh a year from the present Rs 2 lakh limit, the agency claimed.

To make her first budget as inclusive as possible, Sitharaman had crowdsourced ideas as well, and relief to the salaried class is believed to be high on her budget agenda today. The Economic Survey which is traditionally released a day before the Budget mentioned yesterday that the government also needs to pump in new investments.

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