Tax payers may get a big blow in this budget. Only a few days are left for the budget (Budget 2023). The Central Government can abolish the old tax system in this budget. Along with this, a plan is being made to abolish the tax exemption.
New tax regime may be applicable
According to the information received from the sources, the government wants to have a uniform tax system across the country, due to which it is believed that the implementation of the New Income Tax Regime can be announced this time.
Tax rates can be cut
In the Budget 2020-21, Finance Minister Nirmala Sitharaman announced a new tax regime, in which tax rates were reduced without exemptions and deductions. Let us tell you that in the assessment year 2021-22, about 5.8 crore people had filed taxes, but less than 5 percent of these people had adopted the new tax system. For this reason, the government can also announce a reduction in tax rates in this budget.
To make the income tax system popular, the Ministry of Finance is considering to cut its rates. Experts believe that there should be only one tax system in the country, in which taxpayers get exemption and it should be very simple.
Exemption is available in the old tax system
Taxpayers get many types of exemptions in the old tax system. In this, exemption is available including House Rent Allowance (HRA), Leave Travel Allowance (LTA) and many sections of the Income Tax Act, 1961. At the same time, many exemptions are available under section 80C including insurance, ELSS, provident fund, PPF.
