Finance Minister Nirmala Sitharaman will be presenting the maiden Union Budget of Modi 2.0 government on Friday, in which she will outline the blueprint to achieve PM Modi's goal of turning India into a $5 Trillion economy.
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Here are a few expectations from Budget 2019 that can make a difference in the Income Tax scenario in 2019:
- Salaried income tax: Salaried people expect tax advantages through house rent allowance (HRA), which is a wage element.
- Tax Slab Changes: The basic tax exemption threshold for Rs 2.5 lakh is currently set. Low-income earners, however, expect an increase to Rs.3 lakh in this limit. Such a change will provide taxpayers with an extra tax advantage of Rs 2,500 a month.
- Tax Deductions: The tax deduction limit for spending and investment is presently under Section 80C at Rs.1.5 lakh. Taxpayers are expected to increase to Rs.2 lakh at this limit. Also, the benefit payable under Section 80D of the medical insurance premium is currently at Rs.25,000. The limit is expected to increase to Rs.30,000
- Associated Indian Chambers of Commerce and Industry (ASSOCHAM) states in its memorandum that parity between wage earners and non-wage earners is necessary. So, it has been proposed by the experts that the inclusion for salaried class individuals of food and lodging expenses under the exemption for leave travel allowance.
- Inheritance Tax: To avoid the accumulation of riches in the hands of a few, the introduction of inheritance tax / state obligation in India would be one of the most efficient techniques.
- Also, by enhancing the capacity to purchase their dream home, the budget will reward the middle class. In this respect, from the current Rs. 2 lakh limit, the tax deduction limit on interest on home loans can be increased to Rs. 2.5 lakh per year. But this improved advantage will come with withdrawal of interest deduction on the second house that was previously permitted.
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