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Expectations from Union Budget 17-18
With Union Budget 2017-18 just hours away. The entire country waits in anticipation. After series of events like the demonetization, merging of Rail Budget with Union Budget, One month early arrival and ongoing UP & Punjab election , this budget is definitely going to be a game changer budget in the history of NDA government.
Let us see the expectation of common salaried man from the Union Budget 2017-18-
1. Increase In Exemption Limit:
This is dearest to the hearts of all the salaried individuals. The Modi Government increased the slab limit by Rs.50000 in its first budget in F.Y. 2014-15. This time looking at the economic surveys this limit is expected to increase by atleast Rs.50,000.
2.Change in Slab Tax Rate:
Another pain point of salaried individual has always been the applicability of high tax rate on their income . Currently all individuals irrespective of gender has following tax rate structure-
|Upto Rs. 2,50,000||No Tax|
The expectation from this budget is that tax at 10% should be levied for the individuals earning upto Rs.10,00,000.
3. Rebate u/s 87A :
As a relief to small taxpayer’s with an income upto Rs.5,00,000 the government provides relief upto 100% of income tax or Rs.5000 whichever is less. This year hopes are to extend the benefit of relief u/s 87A to tax-payers earning income upto Rs8,00,000 or increase the Rs.5,000 limit.
4. More benefit on holidays :
Leave Travel Allowance is the allowance provided by the employer to meet the costs of vacation time of employees. Write now two travels in block of four calendar year is allowed for travel within Indian . Hopes are raised to allow the LTA exemption for every calendar year with inclusions of foreign travel in the LTA exemption.
5.Increase in Tax Free Allowance
Currently the Income Tax Law provides certain tax free allowances like children education allowance, transport allowance, meal allowance with very low limit. These limits are not in line with the current inflation and hence not able to offer benefit to salaried individuals. Although the transport allowance limit was increased by Rs.800 per month. These limits are expected to be further increased to make the salaried individual happy .
6. Make housing more affordable:
After the demonetization, the worst hit sector is the real estate. The government will definitely encourage the individuals to buy houses by bringing in some lucrative schemes like increase in interest on home loan deductions, excluding the principal repayment portion from the 80C limit etc.
7. Deduction u/s 80C:
This deduction has always been in lime limit for the salaried individuals . This is the section which provides the maximum freedom to tax-payer’s to take advantage of tax savings on their investments/expenses. The current limit is Rs1,50,000 (increased by Modi Government in first budget). This limit is further expected to increase.
8. Increase of exemption u/s 80TTA :
After the surgical strike of Modi government on the black money, the entire country has deposited their cash reserves with their banks. To pacify the agitated tax-payer’ the Modi Government is likely to increase the existing deduction limit of Rs.10,000 on saving bank interest .