Budget 2023: Nirmala understands the suffering of the middle class! Will the burden of income tax be reduced? – mssewb.org

Union Budget 2023: The Union Budget is going to be presented in the Parliament. Time in hand is less than a week. Recently, Nirmala Sitharaman also said that she is quite aware of the plight of the middle class. He said about the middle class, ‘I myself have come from the middle class. So I understand what the middle class is going through now.’ Middle-class taxpayers are expecting a fully middle-class-friendly budget from Finance Minister Nirmala Sitharaman with changes in income tax and tax slabs.

Also what Indian taxpayers expect is income tax exemption on prepayment of housing loan. Under the new tax structure, taxpayers will have to give up all exemptions, due to which the government has not received much response from a large section of the taxable population.

Experts feel that the Center should reduce the top income tax slab rate in the new tax regime in this budget to increase disposable income and revive savings and investment. According to them, the tax rate in the highest slab should be reduced to 25 per cent (including surcharge) equal to the corporate tax rate in the new system.

In Budget 2020-21, the government brought in an optional income tax system. The system allows individuals and Hindu Undivided Families (HUFs) to pay lower tax rates without availing certain concessions such as House Rent Allowance (HRA), home loan interest benefits. Investments made under section 80C, 80D and 80CCD are tax-free up to a total of Rs 2.5 lakh.

Under this system, income between Rs 2.5 lakh and Rs 5 lakh is taxed at 5 per cent, between Rs 5 lakh and Rs 7.5 lakh is 10 per cent, between Rs 7.5 lakh and Rs 10 lakh is 15 per cent, and between Rs 10 lakh and Rs 12.5 lakh is 20 per cent. Besides, 25 percent tax is levied on 12.5 lakh to 15 lakh rupees and 30 percent tax above 15 lakh rupees.

Under the old tax system, individuals earning up to Rs 2.5 lakh were fully exempted from personal income tax. Income between 2.5 lakh and 5 lakh would have to pay 5 percent tax. Those whose income was between Rs 5 lakh and Rs 10 lakh paid 20 per cent tax. 30 percent tax was payable on income above Rs 10 lakh.