Sitharaman’s Steady Hand: No Changes in Tax Regime Amidst Stability

In a decisive move, Finance Minister Nirmala Sitharaman has announced that there will be no alterations to the existing tax regime in the interim budget leading up to the Lok Sabha election in 2024. Taxpayers, however, may find solace in the minister’s assurance that their contributions have been utilized judiciously for the nation’s development and the welfare of its citizens.

Over the past decade, direct tax collections have witnessed an impressive threefold increase, with the number of return filers swelling to 2.4 times its previous figure. Sitharaman expressed appreciation for taxpayers’ steadfast support and emphasized the government’s commitment to utilizing funds wisely.

The minister highlighted the government’s efforts to ease the tax burden on citizens, pointing out the significant changes in the tax landscape over recent years. The new tax scheme ensures no tax liability for individuals with income up to ₹7 lakh, a notable increase from ₹2.2 lakh in the financial year 2013-14. Additionally, thresholds for presumptive taxation for retail businesses and professionals have been raised, while corporate tax rates have seen a reduction, fostering a more business-friendly environment.

Sitharaman’s budget also addresses the need for continuity in taxation, proposing an extension of certain tax benefits for start-ups and investments made by sovereign wealth or pension funds until March 31, 2025. This move is aligned with the government’s vision to enhance the ease of living and doing business.

In a bid to improve taxpayer services and alleviate concerns, the finance minister announced the withdrawal of outstanding direct tax demands. Taxpayers with demands up to ₹25,000 pertaining to the period up to the financial year 2009-10 and up to ₹10,000 for financial years 2010-11 to 2014-15 will benefit from this initiative, impacting around a crore taxpayers.

Sitharaman’s measured approach in maintaining the status quo in tax rates and offering relief to taxpayers facing outstanding demands reflects a commitment to stability and a focus on easing the financial burden on citizens. As the country navigates economic challenges, this budget reinforces the government’s dedication to responsible fiscal management and support for its taxpayers.