Union Finance Minister Nirmala Sitharaman will present the general budget on February 1. Salaried class taxpayers are expecting relief in income tax from this budget. Let’s know about it in detail.
According to the Income Tax Department, about 50 percent of the income tax returns filed in 2022 were filed by the salaried class.
That’s why such taxpayers hope that the government will make some special announcement for them in the budget 2023. Recently, the Finance Minister had said that she understands the pressure on the middle class. The government will take further steps in their interest as well.
Increase in tax limit
Due to rising inflation, there has been an increase in the cost of living. In such a situation, taxpayers are expecting an increase in the income exemption limit of Rs 2.5 lakh to Rs 5 lakh under the new tax system. 5% tax has to be paid on salary between 2.5 to 5 lakhs and 20% tax on 5 to 7.5 lakhs.
Exemption limit under 80C
Under Section 80C of Income Tax, taxpayers get a rebate of Rs 1.5 lakh on investment every year. Taxpayers are demanding to increase this limit. If the government takes a decision on this in the budget, then taxpayers will get a big relief. Saving options like PPF, ELSS, NSC, NPS, Bank FD come under this.
Under Section 16 (ia) of Income Tax, the salaried class gets exemption every year under the standard deduction limit of Rs 50,000. The salaried class is also expecting an increase in this. He is hopeful that the government may increase the standard deduction limit from Rs 50,000 to Rs 75,000.
Retirement plan investment
Employed people are hopeful that the government will increase the tax exemption limit for investing in retirement plans. It is being said that the government can increase the exemption limit from Rs 50,000 to Rs 1 lakh under Section 80CCD (1B) of Income Tax.
Health insurance claim
The current limit for claiming health insurance under section 80D is Rs 25,000. It is expected that in this budget, the government will increase it to Rs 50,000. Apart from this, the exemption limit for the elderly can be increased from Rs 50,000 to Rs 75,000.