Budget 2023: Will there be any Tax Slab Change in Upcoming Budget? Getting signals

Budget 2023 is around the corner and this will be the last full-time budget before the 2024 general elections. After that, in 2024, the government will also present the budget in February, but it will only be an interim budget. A full-time budget will likely be presented in July following the formation of the new government in 2024.

As per a survey conducted by Team Studycafe, around 70% of Taxpayers are demanding an increase in slab limit and an increase in Section 80C Deduction Limit.

Prior to the elections, it is anticipated that the government will be able to make a number of concessions to the citizens. But before announcing these concessions, the government will focus more on those schemes in the budget for which the target of 2022 was fixed, for example, doubling the income of farmers, providing houses to all.

The focus of the upcoming budget may initially be on the distribution of funds to accomplish these unfinished goals since the government has been delayed in achieving them as a consequence of Corona.

Government may offer Tax Rate Exemptions

Before retirement, Revenue Secretary Tarun Bajaj has indicated that changes in tax slabs will also be made in this budget. But these changes will not be made in the old tax system. If these changes are made then the government will do it in the new tax system brought in 2020. The reason for this is that people have not adopted the new tax system as per the expectations of the government.

In such a scenario, the government can gradually advance on the plan to continue with only one tax system by eliminating the old tax system by enrolling more and more people in this new system.

Tax Slabs will be Change

Two taxation systems exist at the moment. Up to Rs. 5 lakh in income is tax-free under the first system, also known as the old system. Along with this, the tax deposit on investments up to Rs. 1.5 lakh is exempt under section 80C. This states that income up to approximately 6.5 lakhs does not require payment of tax.

Revenue Secretary Tarun Bajaj suggested before leaving office that if income up to 6.5 lakhs can be taxed after exemption, then the tax system should be set up so that income up to 6.50 lakhs is completely exempt from taxation.

Common Man has demanded that Finance Minister should reduce Tax rates for Individuals who pays 20% on above 5 lacs and 30% above 10 lacs Income, unlike Corporates who pay 25% with all expenses deduction.

Professionals are also suggesting that government should go for a new slab and enjoy a lower rate for above 5 lakh income also.

Most of the Taxpayers are looking for an increase in Slab Rates. They are also looking for a Reduction in Capital Gain Tax as well and an increase in Section 80C Tax Deductions.