Taxpayers have high expectations fueled by discussions around rationalizing tax slabs in the old income tax regime and increasing exemption limits in the new regime.
Government officials at senior levels have suggested that measures are being considered by the government to provide tax relief aimed at boosting consumption and demand, all while avoiding an increase in welfare spending.
Some experts remain unsure about the reports on tax slab rationalisation and increased exemption limit, despite the promising appearance of this strategy.
No major changes in taxation
He suggested that incentives for the manufacturing sector and increased social expenditure in rural India would likely come in the form of populist measures to stimulate consumption.
Khemka, however, does not foresee any "radical changes in taxes.
Some economists, on the other hand, believe that the government might introduce tax breaks or incentives, pointing out that such measures have not been implemented for quite some time.
Some tax breaks expected
Under both regimes, one possibility is to increase the basic income tax exemption limit to Rs 5 lakh.
FM Sitharaman is expected to present the Union Budget 2024-25 in late July. There are suggestions to introduce basic tax deductions to promote adoption of the new income tax regime. While some tax relief may be offered, substantial changes are improbable, as the government aims to maintain policy continuity and fiscal discipline.
