On July 26, 2024, India’s Finance Minister Nirmala Sitharaman said that the government is open to all views on the tax changes proposed in Budget 2024. However, she clarified that the Finance Bill is now with the Parliament, and hence she cannot comment on it.
Budget 2024 Highlights
Sitharaman said in an open house that “the Finance Bill is the property of the House, I cannot comment on it outside”. She also informed that the central government has not increased taxes due to the need for more money. The Finance Minister said that every asset class should be given equal treatment. She described Budget 2024 as ‘futuristic’ and said that “nothing is done with just a back of the envelope calculations”.
Capital Expenditure and Youth Skill Development
Sitharaman also informed that the government will continue capital expenditure (capex) to sustain economic reforms. He termed NDA 3.0 as historic and said that the budget has made small and big allocations for skill development of the youth of the country.
Tax changes and their impact
Several important tax changes have been announced in Budget 2024. Following are some of the major changes:
Standard deduction: The standard deduction has been increased from ₹50,000 to ₹75,000, providing relief to over four crore salaried individuals and pensioners.
Changes in tax slabs: The income limits have been revised in the new tax slabs, with income up to ₹3 lakh attracting no tax, and between ₹3 lakh and ₹7 lakh attracting 5% tax.
Long-term capital gains tax: The Finance Minister also informed that short-term gains on certain financial assets will be taxed at 20% and long-term gains on all financial and non-financial assets will be taxed at 12.5%.
Review of tax laws
Sitharaman also announced a comprehensive review of the Income Tax Act 1961, which will make it easier to read and understand. This process will be completed in six months.
Nirmala Sitharaman made it clear that the government is ready to listen to all views and is committed to taking Budget 2024 in a positive direction. She also said that the government aims to provide equal opportunities to all sections and strengthen the economic condition of the country.
Thus, Budget 2024 is not only an important step for tax reforms, but it also presents a positive outlook for skill development and economic stability of the youth of the country.
