Union Budget 2024: Finance Minister Nirmala Sitharaman will present the Modi 3.0 regime’s first budget on July 23. It is expected to be full of big-ticket announcements for various sectors. Among the hopefuls are salaried taxpayers, who are anticipating some much-needed tax relief. In particular, those earning less than Rs 10 lakh per year are expected to benefit the most from the Modi government’s tax-relief measures, according to experts.
Since there have been no major changes in taxation policies in the last two budgets, except for making the new tax regime the default option and introducing the Standard Deduction feature, taxpayers are hopeful that the first budget of the Modi government’s third term might announce some significant tax breaks for them.
In the upcoming budget, it is widely expected that the Modi government will provide significant tax relief to those earning up to Rs 10 lakh. This measure aims to address the high cost of living and boost consumption by increasing disposable income.
Income Tax Slabs – New Tax Regime FY 2023-24
| Income Tax Slabs | Income Tax Rates |
| Up to Rs 3 lakh | Nil |
| Rs 3 lakh to Rs 6 lakh | 5% (Tax rebate u/s 87A) |
| Rs 6 lakh to Rs 9 lakh | 10% (Tax rebate u/s 87A up to Rs 7 lakh) |
| Rs 9 lakh to Rs 12 lakh | 15% |
| Rs 12 lakh to Rs 15 lakh | 20% |
| Above Rs 15 lakh | 30% |
Lower taxes for income up to Rs 10 lakh in budget likely
Under the new tax regime, FM Sitharaman may provide lower income tax rates for taxpayers earning up to Rs 10,00,000 annually, says Akhil Chandna, Partner, Grant Thornton Bharat. Some tax relief is also expected for those taxpayers earning above Rs 15 lakh per annum, Chandna added.
“Such measures would lessen the tax burden on higher-income groups and enable lower-income groups to allocate more towards essential expenses and savings,” he emphasised.
Among other major expectations from the government in this upcoming budget are increasing the basic exemption limit and deductions under the new tax regime.
Increasing the basic exemption limit
Basic exemption limit under the new tax regime will increase from Rs 3 lakh to Rs 5 lakh in the upcoming budget. This enhancement will reduce the tax liability of taxpayers by Rs 10,000 (excluding cess and surcharge) for individuals earning annual incomes exceeding 7 lakh and who are not eligible for any rebate under Section 87A.
Also read: Budget 2024: Modi govt to raise tax exemption limit to Rs 5 lakh under new tax regime?
Deduction under new tax regime
Salaried individuals are expecting enhancement in the amounts for standard deduction, 80C, 80D & housing loan interest deduction amount under Section 24. Further, the expectation is to extend the benefit of said deductions under the new tax regime as well to make it more lucrative.