NEW DELHI: Finance Minister Nirmala Sitharaman is all set to announce the Union Budget 2023, today, February 1, 2023. One of the major areas that will be in focus during the budget is the consumer and retail sector.
Before the Union Budget 2023, here are the top five things we expect from Union Finance Minister Nirmala Sitharaman.
Changes to Income Tax: The standard deduction should increase from the existing level of 50,000 to 100,000, and the income tax exemption limit should be adjusted from 2.5 lakh to 5 lakh. It is also widely expected that the Finance Minister will increase the Section 80C deduction ceiling of 1.5 lakh rupees for investments in PPF, tax-saving mutual funds, national savings certificates, etc. To make the new tax system (announced in budget 2020) more enticing, additional reductions are also anticipated.
changes to the capital gains tax: Most people anticipate that the government will standardise the holding time for capital gains tax among various asset types. Long-term gains on equity are taxed at a rate of 10%, while those on debt mutual funds are taxed at a rate of 20% with indexation.
Encourage corporate tax and indirect tax reforms: The industry wants to extend the 15% tax rate for new manufacturing businesses, which is currently on concession and is set to expire on March 31, 2024, in order to advance the corporate tax reforms. A one- to five-year extension has been requested by industry. The Finance Bill 2023 is anticipated to exclude input tax credits for spending on corporate social responsibility from the GST.
Balance between imports and atma nirbharta: The Indian government has long focused on Atmanirbhar Bharat, and as a result, prior budgets have emphasised import substitution while increasing customs taxes to support domestic producers. Taxes on everything from private planes and helicopters to electronics, plastics, iron and steel, jewellery, and leather are set to increase in this year's budget. The goal is to reduce India's total trade deficit, particularly with China.
More money is now in rural India's hands.: India's rural areas can anticipate efforts to raise wages and boost demand. Farmers expect an increase in the cash transfer scheme PM Kisan to compensate for rising input costs and to boost non-farm wages More funding from the government is anticipated for rural jobs, housing, and roads. More money from the government is anticipated to be given to farmers as incentives to transition to organic farming.
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