New Delhi: Future budgets may increase standard deductions. This figure could double from the current 50,000 rupees to 1 rupee.
Budget 2022 may also introduce tax-exempt telecommuting allowances for office workers. Higher deductions for such costs will increase takeaway salaries. In addition, direct tax collection was firm in FY2010. This allows you to raise the tax credit limit. William O’Neil India is a company that provides financial services and information and is mentioned in the memo.
In the 2021 budget, the Minister of Finance has introduced a new tax system. However, this system did not have much merit. According to consensus, most taxpayers did not want to move to the new system because they continue to have the old system and cannot use the return on investment under the new system. With budget 2021, the income tax slab remained untouched.
This time, it is expected that duty-free slabs may be raised from the current rupees of 0-2.5 rupees. If the personal income tax is reduced, disposable income will increase and consumption will be promoted. According to the report, increased compliance with GST will ensure that governments can increase the percentage of indirect taxes that are levied.
Looking at elections, rural economies can receive more allocation. About 25% of the country’s rural population is in five states that vote from February to March. Therefore, the government is expected to maintain increased welfare spending in rural and agricultural areas. The government can focus on welfare spending such as food subsidies, MGNREGA, PM-Kisan and fertilizer subsidies. Employment was an important issue. MGNREGA is a labor market shock absorber and FM has the potential to raise wages and working days. Despite some efforts, farmers’ incomes have not increased as expected. Therefore, the government can take further steps to improve farmers’ incomes, the report said.
In 2004, the Securities Transaction Tax (STT) replaced the Long Term Capital Gains (LTCG) tax. Budget 2018 has revived LTCG and has been recollected at a rate of 10% of annual profits in excess of Rs 10,000. However, the STT was not deleted.
Many new investors have embarked on an investment journey in the last 12-18 months. Removing the STT will allow some of these investors to start trading. Investors want to remove LTCG, but the government told the Winter Parliament that it has no plans to abolish the LTCG tax on stocks and trusts. Therefore, it is expected that the STT will be removed in budget 2022. However, it is estimated that with increasing investor and trading volumes in the market, STTs can generate more than 5,000 rupees in revenue. The LTCG collections for 2019-20 and 2020-21 were Rs 3,460 and Rs 5,311 respectively. Looking at these numbers, the report says the government is unlikely to make any changes here.
The government needs to leave more money in the hands of taxpayers. Looking at the current figures, if the government resists the change in the tax slab, it may be possible to raise the upper limit of Section 80C of the tax-saving scheme from the current 1.5 rupees to 2.0-2.5 rupees. This will not only leave more money in the hands of taxpayers, but will also stimulate savings. This can also be a plus for asset managers.
The pandemic highlights the importance of medical insurance for families as they pay huge costs for treatment. Currently, health insurance premiums are exempted up to Rupees 25,000 for people under the age of 60 and up to Rupees 50,000 for people over the age of 60. The pandemic increased these claims, after which the insurance company paid premiums. Increasing medical insurance deductions will help promote insurance coverage and bring relief to laymen, the report said.
https://www.siasat.com/tax-free-work-from-home-allowances-for-salaried-employees-likely-in-budget-2266938/ Tax exemption for telecommuting for office workers who are likely to be within budget