Arjuna (Fictional Character): Krishna, Honourable Finance Minister Mrs. Nirmala Sitharaman will be declaring the Finance Budget of 2022-23 on 01st February in the Lok Sabha. Everyone is excited for the Budget. But due to corona, “Halwa” Tradition has been discontinued and “Mithai” has been distributed. Krishna, What the taxpayer’s will get Halwa or Mithai in the Budget this year?
Krishna (Fictional Character): Arjuna, Budget in simple language, is a financial document used to estimate future revenue and expenses of the upcoming year. Governments revenue and finances works on the basis of this document. This means that efforts are taken to either earn projected or more revenue. Also plans are made to manage the expenditure up to the projected limit. Lot of expectations are there from budget, like to keep GDP high, Increase Govt. Expenditure in Infrastructure, Housing and Education sector. Further Start Up, make in India, etc needs to be boosted. Lots of Complexity is there in economic world due to Covid-19 and its effect on India. It’s like walking on tight rope.
Arjuna (Fictional Character): Krishna, in case of direct taxes which things are expected in this year’s Budget for common man?
Krishna (Fictional Character): Arjuna, direct tax mainly includes Income Tax. In Income Tax mainly following changes are expected.
1) In order to charge less tax to common man, giving a direct relief on income up to Rs. 5 lacs instead of tax rebate, that is no tax up to 5 lacs is expected.
2) The limit of section 80C and other similar deductions sections may be increased from Rs. 1.5 lacs to Rs. 3 lacs.
3) The government may think of increasing the limit of deduction of interest on home loan from 2 lacs to 3 lacs.
4) The government may increase the standard deduction from Rs. 50000 to Rs. 1 lac in case of Salaried Individuals considering the cost of Inflation over the years and rise in living expenses.
5) Presently E-commerce Operators are required to deduct TDS @1% u/s 194 O which may be reduced to 0.1% as a relief to Taxpayer.
6) It is expected that the Budget may offer clarity on Crypto assets, which would clear the ambiguities around the taxation and disclosure requirements on crypto assets for Taxpayers.
7) The government may provide tax incentives to stress sectors such as Automobiles and real states, so more jobs can be created in the market.
Arjuna (Fictional Character): Krishna, what should one learn from this?
Krishna (Fictional Character): Arjuna, last year life of every person in the world has been affected to outbreak of covid-19. Many people have lost their jobs and their hard earned life savings. Thus, this year there are lot of expectations from the government that it will bring relief for common man in this budget. It will be interesting to know who will get halwa and who will get Mithai in this Budget!