Union Budget 2024 is just a few days away. The common citizens are hopeful that Finance Minister Nirmala Sitharaman will fulfill their aspirations. Let’s find out what the common man wants from the Finance Minister in the Union Budget on February 1.
Revision in the Section 80C Deduction Limit: Taxpayers are urging an increase in the deduction limit under Section 80C. Currently capped at Rs 1.50 lakh per year, the individuals suggest a minimum raise to Rs 2.50 lakh, emphasizing that the present limit has seen minimal adjustments over the past eighteen years.
Changes in tax slabs: Tax slabs have not changed since 2014. This is burdening households with higher real tax rates. Indexation of tax slab limits to inflation will leave more money in the hands of middle class consumers to meet spending pressures without financial loss,” said Shar India Fincap executive. Director Agam Gupta said.
Special limit for the principal repayment: As per the current provisions of Section 80C of the Income Tax Act, you can claim a deduction of up to Rs 1.5 lakh from your taxable income to repay the principal amount of the home loan taken for residential property. This deduction is available along with other eligible expenses like life insurance premiums, tuition fees, contributions to the Provident Fund, Public Provident Fund, EPF, ELSS, National Savings Certificates, Tax Saving Bank FDs, etc.
Tax Provisions on NPS Withdrawals: Concerns are raised about the tax treatment of National Pension Scheme withdrawals. Currently, only 60 percent of NPS withdrawals are exempted from tax, and the remaining amount used to purchase an annuity becomes taxable when received. Taxpayers seek parity with EPF withdrawals, which are entirely tax-free at retirement. Suggestions include eliminating the mandatory annuity purchase with 40 percent of the corpus, allowing the subscribers to decide where to invest money.