Finance Minister Nirmala Sitharaman tweaked the slabs to provide some relief to the middle class by announcing that no tax would be levied on annual income of up to Rs 7 lakh under the new tax regime. She also allowed a Rs 50,000 standard deduction to taxpayers under the new regime, where assessees cannot claim deductions or exemptions on their investments.She also tweaked the concessional tax regime, which was originally introduced in 2020-21, by hiking the tax exemption limit by Rs 50,000 to Rs 3 lakh and reducing the number of slabs to five.
In the Budget for 2023-24, Sitharaman said currently individuals with total income of up to Rs 5 lakh do not pay any tax due to rebate under both the old and new regimes.
Govt to bring Vivad Se Vishwas-2 scheme
Govt to bring Vivad Se Vishwas-2 scheme
Fiscal deficit to be brought down under 4.5%: FM
Fiscal deficit to be brought down under 4.5%: FM
"It is proposed to increase the rebate for the resident individual under the new regime so that they do not pay tax if their total income is up to Rs 7 lakh," Sitharaman said.She further said under the new personal income tax regime, the number of slabs would be reduced to five."I propose to change the tax structure in this regime by reducing the number of slabs to five and increasing the tax exemption limit to Rs 3 lakh," Sitharaman said.
The new slabs under new tax regime are:
Up to Rs 3 lakhs: Nil
From Rs 3-6 lakhs: 5%
From Rs 6-9 lakhs: 10%
From Rs 9-12 lakhs: 15%
From Rs 12-15 lakhs: 20%
Over Rs 15 lakhs: 30%
"I propose to extend the benefit of standard deduction to the new tax regime.“Each salaried person with an income of Rs 15.5 lakh or more will thus stand to benefit by Rs 52,500," Sitharaman said.
With effect from April 1, these slabs will be modified as per the Budget announcement.
senior citizens' Savings Scheme deposit limit raised to Rs 30 lakh
The Finance Minister proposed to double the deposit limit for Senior Citizen Savings Scheme to Rs 30 lakh and Monthly Income Account Scheme to Rs 9 lakh.
The minister also announced a new small savings scheme for women.
"The maximum deposit limit for Senior Citizen Savings Scheme will be enhanced from Rs 15 lakh to Rs 30 lakh," the minister said in her 87-minute long speech.
She also proposed that the maximum deposit limit for Monthly Income Account Scheme will be enhanced from Rs 4.5 lakh to Rs 9 lakh for a single account and from Rs 9 lakh to Rs 15 lakh for a joint account.
Announcing a new 'Azadi Ka Amrit Mahotsav Mahila Samman Bachat Patra', Sitharaman said a one-time new small savings scheme, Mahila Samman Savings Certificate, will be made available for a two-year period up to March 2025."This will offer deposit facility up to Rs 2 lakh in the name of women or girls for a tenor of 2 years at fixed interest rate of 7.5 per cent with partial withdrawal option," she said.
The minister also announced to that an integrated IT portal will be established for investors to reclaim unclaimed shares and unpaid dividends from the Investor Education and Protection Fund Authority with ease.
Revamped credit guarantee scheme for MSMEs
A revamped credit guarantee scheme for MSMEs with an outlay of Rs 9,000 crore will be launched from April 1. She also said the Centre will launch the 'Dekho Apna Desh' initiative to promote domestic tourism.
Further, the government will set up National Financial Information Registry for facilitating the efficient flow of credit and fostering financial stability.
PAN to be common identifier for govt agencies
Finance Minister said that Permanent Account Number (PAN) will be used for common identifier for all digital systems of specified government agencies.
The move would help in further promoting ease of doing business in the country.
66% hike in Pradhan Mantri Aawas Yojana outlay
Nirmala Sitharaman announced a 66 per cent hike in the Pradhan Mantri Aawas Yojana (PMAY) outlay to Rs 79,000 crore.
She also said that the Union government will create Urban Infrastructure Development Fund on the lines of Rural Infrastructure Development Fund and it will be managed by the National Housing Bank.
The central government will spend Rs 10,000 crore per year for urban infrastructure development fund. All cities and towns will be enabled for 100 per cent transition of sewers and septic tanks from manhole to machine hole mode, the minister added.
Fiscal deficit to be brought down under 4.5% by 2025-26
Fiscal deficit would be brought down to below 4.5 per cent by 2025-26, Finance Ministersaid. She also said that tax receipts for the next fiscal are budgeted at Rs 23.3 lakh crore and states would be allowed 3.5 per cent of GDP as fiscal deficit.To finance the fiscal deficit in 2023-24, net market borrowing from dated securities is estimated at Rs 11.8 lakh crore, Sitharaman said while presenting the Union Budget for 2023-24 in the Lok Sabha.She retained the fiscal deficit target of 6.4 per cent in the revised estimate for FY2022-23 and reduced it to 5.9 per cent for the next fiscal.
The government had pegged the fiscal deficit at at 6.4 per cent of the GDP for the current financial year.The fiscal deficit or the gap between expenditure and revenue for 2022-23 is estimated to be Rs 16,61,196 crore. The country's fiscal deficit was projected higher at 6.9 per cent for 2021-22 as against 6.8 per cent estimated earlier.The Revised Estimates for 2021-22 indicate a fiscal deficit of Rs 15,91,089 crore as against the Budget Estimates of Rs 15,06,812 crore.
