Priti Singh:- On July, 5 Finance Minister Nirmala Sitharaman all set to announce the budget, citizen expectation are sky high. The major demand proposed is lower taxation, especially those who belong to the middle- group. Here are few changes that could be announced by Nirmala Sitharaman:
Income Tax release limit
As per the report, a full tax rebate up to Rs 5 lakh was introduced under Section 87A in the interim budget; it is unlikely that there will any other alteration in the exemption. But citizens and many industry bodies want the government to increase the tax exemption threshold from the existing Rs 2.5 lakh to at least Rs 3 lakh.
Deduction in Higher Income Tax
People exempting a hike in exemption limit may end up being disappointed but the government may cheer them up by introducing higher deductions under several sections of the Income Tax Act.The income tax deduction allowed under Section 80(C), currently at Rs 1.5 lakh, could be raised to Rs 2 lakh or above.
Tax benefits in Healthcare
There are high chances that the government will increase deduction under tax saving instruments available in healthcare. Industry bodies have already asked the government to increase tax saving under Section 80(D) of the Income Tax Act. The limit could be increased from the current Rs 25,000, applicable to people aged below 60 years, under Section 80(D). The concession could also be raised under Section 80(D) for people above the age of 60 years. The current limit of exemption for people above 60 years is Rs 50,000.
Deduction on home loans
Since the real-estate sector has been affected negatively due to a demand slowdown, the government could offer more tax benefits to buyers and provide a much-needed boost to the sector. According to the latest details, people can claim a maximum deduction up to Rs 2 lakh under Section 24B of the Income Tax Act.