Budget 2024: What can taxpayers under new tax regime expect?

Budget 2024: What can taxpayers under new tax regime expect?

The full budget for the financial year 2024 (FY24) is just a few weeks away, with taxpayers across the nation hoping for tax relief.

Experts have mentioned that the government could focus on increasing consumption for middle class families, which would contribute to the already robust GDP numbers.

As per media reports, the government could announce measures to make the new tax regime more attractive to pull taxpayers from the old tax regime.

While there are many measures taxpayers under the new tax regime would like to be implemented, below are a few that could be implemented in the upcoming budget.

Standard deduction

"There's a long-standing demand for an increase in the amount of standard deduction for salaried individuals and some increase in the rebate amount," saidRitika Nayyar, Partner, Singhania & Co.

Introduction of deductions or exemptions

She further added that although the current new regime does not allow any deductions or exemptions, introducing at least some investment-based deductions, which were allowed under section 80C in the old regime, would make the new regime quite attractive.

"Taxpayers would benefit from additional advantages such as planning for retirement, children's education, and financial growth, which contribute to their long-term financial health," said Nayyar.

Greater flexibility for business and professional taxpayers

Experts have also called for increased flexibility for business and professional taxpayers to switch between tax regimes.

"More flexibility on switching between regimes for business /professional taxpayers," said Nayyar.

In the upcoming budget, taxpayers are hoping for some positive tax relief measures. Reports indicate that the government is considering plans to provide some tax relief, either by rationalising tax slabs or by raising the basic exemption limit.

Finance Minister Nirmala Sitharaman is likely to present the full budget on July 22 or 23, 2024.

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