The?interim Budget 2024 is set to be presented by India¡¯s Finance Minister, Nirmala Sitharaman, on February 1. Ahead of that, the Parliament Budget session is expected to take place from January 31st to February 9th.
Even though the full Union Budget 2024 will be presented in July by whoever forms the government after the Lok Sabha Elections, the common man must have a long list of expectations?from the interim budget too.?
Here are some of the major?expectations that salaried taxpayers have from the upcoming?Interim Budget 2024:
The standard deduction is among the most popular tax deductions, as salaried?taxpayers can claim it without having to make any investments. An?increase in the standard deduction?cap has long been demanded. Since the standard deduction was included in the new income tax regime last year, the demand has grown louder this time.
It is noteworthy that the last time standard deduction was changed was in 2019, which was five years ago. So now, taxpayers are hoping to see the limit for standard deduction increased?from Rs 50,000 to Rs 1 lakh. Will that happen in the budget for?2024? That remains to be seen.
The deduction limit under?Section 80D for medical insurance premiums?should be increased from ?25,000 to ?50,000 for individuals and ?50,000 to ?75,000 for senior citizens, reflecting rising healthcare costs.?Furthermore, bringing Section 80D benefits into compliance with the?new tax regime?would encourage fair access to healthcare.
Also Read:?FAQs On Upcoming Interim?Budget 2024
Currently,?life insurance premiums are eligible for tax savings under Section 80C, and health insurance premiums under Section 80D. However, in the case of a personal accident, home, or travel insurance policy, there is no such premium deduction available.?
That is why introducing tax benefits for such insurance premiums will encourage people to safeguard their possessions, such as?homes and cars, and obtain personal accident insurance. By taking this action, the policyholder will be better protected financially and from any financial losses brought on by unanticipated life events.
Even though the Indian Constitution recognises Bengaluru?as a metro city, it is categorised as a?non-metro?for income tax purposes, implying that residents can only deduct 40% of their HRA, as opposed to 50% in other metro cities. That is why taxpayers expect the Finance Minister to now include Bengaluru as a metro city?for tax purposes too.
For many people in our country, bank savings accounts still remain a popular option for investing. According to banks, which had already made representations to the finance ministry on the matter,? bank FDs may become competitive with small savings plans and insurance products if investments of up to Rs 5 lakh are made tax-free?in Budget 2024.
At present, the?tax liability of FD investors?does not end with TDS deductions done by banks. The entire interest income on your fixed deposit is added to your annual income and taxed as per your income tax slab.
Also Read:?PPF vs?Bank Tax?Saver?FD-Which One To Choose For?Tax?Saving?
Tax deductions for life insurance premiums, NSC, PPF, ELSS, home loan principal, and other items are already included?under?Section 80C. Thus, it is the need of the hour to increase the deduction limit from the current threshold of Rs. 1.5 lakh to Rs. 2.5 lakh, or at least Rs. 3 lakh, under this section. Doing so can encourage people to purchase insurance as well as make investments, in addition to providing additional breathing space for the tax benefits of other available tax deductions.
Also Read:?10 Tax Saving Options Other Than?Section 80C
Many home loan borrowers aren't able to?take advantage of the tax deduction on their principal repayments?under Section 80C because of this section's overcrowding. Similar is the case for interest payments, which have an upper limit of Rs 2 lakh per year under Section 24b. That's why many taxpayers who are also serving home loan EMIs expect that Budget 2024 will include a?separate section for?home loan?repayments, with a maximum deduction of Rs 5 lakh for both principal and interest payments.? ?
Also Read:?From Election To?Budget: 5 Big Events In?2024?That Can Make Or Break The Stock Market
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