NewDelhi: The Modi government will begin its budget session on January 31 before Finance Minister Nirmala Sitharaman delivers the Union Budget on February 1, 2025. Prime Minister Narendra Modi’s new cabinet will receive its second complete budget as Finance Minister Nirmala Sitharaman follows up on the July 2024 general budget, which rolled out multiple sectorial relief measures. Currently, taxpayers hope the anticipated new budget will offer fresh economic stimulus as the government seeks both economic expansion and consumption growth.
Currently, there are two income tax regimes available for taxpayers: Two income tax options remain, which comprise the existing tax regime and the tax regime established by the government in 2020. Officials are expected to propose major changes in the new tax system to stimulate consumer spending. Tax slab adjustments represent one of the budget changes taxpayers await.
An adjustment to tax exemption may happen so that middle-class citizens can benefit from expanded income limits which exclude tax payments. People who earn up to ₹7.75 lakh a year currently do not have to pay taxes after standard deductions are applied. Sources speculate that the tax-free income limit might increase to ₹10 lakh. Last year, The standard deduction limit rose from ₹50,000 might increase again this year to ₹1 lakh from its current ₹75,000 level.
Finance Minister Sitharaman will review tax brackets under the current regime for the 2025 Budget announcement. The main objective of government taxation policy is to keep more disposable income for the middle class so they can spend more, which leads to increased economic activity. Experts think taxpayers who face a 20% rate might see their income threshold rise above ₹12 lahks ₹15 lahks to reach ₹20 lahks.
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