Many announcements have been made in the budget for the tax payers. Let’s take a look at the 10 big announcements made by the Finance Minister for taxpayers.
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On 1 February, Finance Minister Nirmala Sitharaman presented the budget for the financial year 2023-24. In this budget, the Finance Minister made many big and important announcements for all sectors and classes. Finance Minister Sitharaman has also kept taxpayers in mind in this budget. Many announcements have been made in the budget for the tax payers. Let’s take a look at the 10 big announcements made by the Finance Minister for taxpayers.
- To give relief to the middle class, the Finance Minister has reduced the income tax rates under the new regime. Along with this, standard deduction of Rs 50,000 has also been allowed. Taxpayers should note that the new regime will now be the default option, if they do not opt for the old tax regime separately.
- At present, taxpayers with income up to Rs 5 lakh do not have to pay any income tax as rebate is available. Now under the new income tax regime, this rebate will be available for those earning up to Rs.7 lakh. Standard deduction of Rs 50,000 is available under the new system, so there will be no tax on income up to Rs 7.5 lakh for salaried people.
- Under the new income tax regime, the surcharge has been reduced from 37 per cent to 25 per cent for taxpayers with taxable income above Rs 5 crore. The maximum tax rate for such taxpayers will now be 39 per cent instead of 42.7 per cent.
- Apart from this, the tax exemption limit on leave encashment received by non-government employees has been increased from Rs 3 lakh to Rs 25 lakh. With this, eligible employees will get additional tax benefit for more leave encashment at the time of retirement.
- For certain professionals, the presumptive taxation scheme is available only where the gross receipts are up to Rs.50 lakh. As per the scheme, 50 per cent of the gross receipts can be considered as taxable business profit. To ease compliance and promote non-cash transactions, the scheme has now been made available for gross receipts up to Rs 75 lakh.
- There will be no capital gains tax on conversion of Glod into electronic gold receipt. This will encourage investment in electronic form of gold.
- The rule related to capital gains tax deduction on the purchase of a new house has been changed. Long term capital gain on sale of an asset is exempt from tax if the capital gain is reinvested in a new house. Many people falling in the HNI category were taking advantage of this exemption by buying very expensive houses. To prevent this, while calculating the exemption, a limit of 10 crores has been imposed.
- Apart from this, if you invest in a life insurance policy, then you will now have to pay tax on the amount received on the maturity of the life insurance policy. In this policy, tax will be levied only if the annual premium is more than five lakh rupees. At the same time, the existing tax exemption on the amount received on the death of the insurance holder will remain intact.
- In the general budget presented by Union Finance Minister Nirmala Sitharaman, it has been proposed to increase the TCS rate to 20 percent on tour packages for foreign travel and sending money from India.
- Lastly, the government has proposed to levy a 30 per cent tax on the total amount won from online gaming. Along with this, the government has also announced to abolish the current limit of Rs 10,000 in the budget 2023. In the budget 2023-24, it has been proposed to bring two new provisions for Tax Deducted at Source (TDS) on online gaming.
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