The Finance Minister Nirmala Sitharaman has presented the Union Budget 2024 (Interim Budget) in Parliament. There have been no changes announced in the tax slabs in both new and old income tax regimes. It remained unchanged for 11 years.
However, the government has reduced and rationalized tax rates. Under the new tax scheme, there is now no tax liability for taxpayers with income up to Rs 7 lakh.
The Finance Minister extended tax incentives and exemptions for startups and investments by sovereign wealth or pension funds for one year.
“Certain tax benefits to startups & investments made by sovereign wealth or pension funds as also tax exemption on certain income of some IFSC units are expiring on March 31, 2024; to provide continuity, I propose to extend the date to March 31, 2025,” she said.
Presenting the Budget 2024, Finance Minister Nirmala Sitharaman said, “Our focus is on four major classes for welfare – youth, women, poor, and farmers. “
“PM Mudra Yojana has sanctioned 43 crore loans amounting to Rs 22.5 lakh crore for the entrepreneurial aspirations of the youth of the country, saying, “Fund of Funds, Startup India and Startup Credit Guarantee Schemes are assisting our youth.” She added.
Withdrawal of Outstanding direct tax demands
Nirmala Sitharaman has announced to improve tax payer services which is in line with the government’s vision to improve ease of living and ease of doing business.
There are a large number of petty, non-verified, non-reconciled, or disputed direct tax demands, many of them dating as far back as the year 1962, which continue to remain on the books, causing anxiety to honest taxpayers and hindering refunds of subsequent years.
The Interim Budget proposes to withdraw such outstanding direct tax demands up to Rs. 25000/- pertaining to the period up to financial year 2009-10 and up to Rs. 10,000/- for financial years 2010-11 to 2014-15. This is expected to benefit about a crore taxpayers.
Direct Tax Collections Trebled
In the last over 10 years, the direct tax collections have more than trebled and the number of return filers swelled to 2.4 times.
Finance Minister Nirmala Sitharaman has also highlighted that the Government has reduced and rationalized the tax rates due to which under the new tax regime there is no tax liability for taxpayers with income up to Rs. 7 lakh.
She also mentioned about increase in the threshold for presumptive taxation for retail businesses as well as professionals. The Minister also mentioned a decrease in corporate tax rates for existing domestic companies from 30% to 22%, and for certain new manufacturing companies to 15%.
In her Interim Budget speech, the Minister said that in the last 5 years, the Government’s focus has been on improving tax-payer services which has led to the transformation of the age-old jurisdiction-based assessment system, and the filing of tax returns has been made simpler and easier.