Budget 2024: In last year’s budget, Finance Minister Nirmala Sitharaman had increased the basic exemption limit in the new tax regime. But, in the old regime, the basic exemption limit has not been changed for the last several years
Finance Minister Nirmala Sitharaman may present the Union Budget in the third week of July. Every section of the society including industry, common people, farmers has many expectations from this budget. The reason for this is that the Finance Minister did not make any major announcement in the interim budget presented on February 1 this year. He had said that for a big announcement, one will have to wait for the full budget to be presented in July. Meanwhile, Deloitte has told about its expectations from the Union Budget.
Basic exemption limit can be 5 lakhs
Consultancy firm Deloitte says that the government can increase the basic exemption limit of income tax in the budget (Budget 2024) to be presented this month. Currently, the basic exemption limit in the new regime of income tax is Rs 3 lakh. In the old regime it is Rs 2.5 lakh. Basic exemption limit means that if a person’s annual income is up to this limit, then he will not have to pay income tax. Deloitte expects that the government may increase the basic exemption limit for the new regime of income tax and the old regime to Rs 5 lakh per annum in the budget. It has said that increasing the standard deduction will benefit crores of people.
Change in the rules of house rent allowance
The Finance Minister should make changes in the house rent allowance in view of the increase in house rent in the last few years. Currently, provisions for house rent allowance have been given under Section 10 (13A). Currently, HRA of 50 percent of the basic salary is allowed only for some big cities. For the rest of the cities, it is 40 percent. There is a need to bring new cities under the purview of HRA of 50 percent of the basic salary. The reason for this is that in the last few years, the rent of houses in cities like Bengaluru, Hyderabad, Noida has increased a lot. This will benefit a large number of people.
Section 80EEA deduction for home buyers
The government should make big announcements in the budget to fulfill the dream of people to have their own house. In 2019, the government had announced a deduction of up to Rs 1.5 lakh on home loan interest for first-time home buyers under Section 80EEA. But, this deduction was only till March 2022. The government has not extended it. The government can again start the deduction available under section 80EEA.
Tax deduction on purchase of electric vehicles
Finance Minister Nirmala Sitharaman can make a big announcement in the budget for electric vehicles. The government has set a target of increasing the share of EVs to 30 percent in the total sales of vehicles by 2030. To increase the sale of EVs, the government in 2019 allowed a deduction of up to Rs 1.5 lakh annually under section 80EEB of the Income Tax Act. This deduction was available on the interest on home loans taken to buy electric cars. This deduction was till March 2023. The government has not extended its period. The government should start this deduction again. Also, it should be increased from Rs 1.5 lakh to Rs 2 lakh.
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