New Delhi:
There is no longer left for the Union Budget to appear on 2025. Finance Minister Nirmala Sitharaman will present the budget of financial year 2025 on 1 February. It will be a big challenge to meet the growing expectations of different sections including taxpayers. The challenge to meet the expectations of taxpayers has become more difficult since 2020, when Finance Minister Sitharaman decided to start the New Tax Regime and continue the Old Tax Regimen as well.
What is the problem of taxpayers?
Due to the two taxes, about 6.5 crore in income taxpayers selected New Tax Reseam, and about 2.5 crore people still file their returns under the Old Tax Resetam. Due to the two options available to file tax, taxpayers are facing many challenges.
Taxation expert CA (Dr.) Suresh Surana spoke about the issue related to the current system with Financial Express and gave measures to simplify individual taxes.
Challenges of tax system
Due to the existing two tax system, taxpayers have to choose one of the Old Tax Reseam or new Default Tax Reset. According to Surana, “Most individual taxpayers, especially employed people, do their tax liability calculations without taking help from professional people. In such a situation, it becomes difficult for them to choose which tax regime option is more beneficial. ”
The New Tax Regime was started to make taxation easier, which has been present as a default option since the Finance Act 2023. Despite this, many people chose it.
Saysa says Surana, “In New Tax Regim, the health insurance premium and standard deduction for salary individual cannot be claimed, due to which many taxpayers still find the old tax regime more attractive.”
Unified tax regime suggested
Seeing these problems, tax experts are suggesting a unified tax reset, which includes the benefits of both Old and New Tax Regies. Tax expert Surana proposes a progressive tax structure that has proposed a progressive tax structure that new slabs for more income You present
For example, 25% tax rate for income between Rs 25 lakh and Rs 30 lakh, while maintaining a rate of 30% for income above Rs 30 lakh can provide great relief. This will reduce the financial birdon on people with more income and will promote compliance.
Tax Examination Slab expected to revise up to 25 lakhs
Experts say that the Income Tax Examination Slab should be revised up to Rs 25 lakh in the Union Budget 2025. This step will have many benefits. By giving tax relief to a large section of middle and high-middle class, the government can directly promote the incomeable income. This will help the consumer to promote expenses and economic activities.
Most of the deductions in new tax regime are no use
Most of the cuttings are not benefited in the new tax regime, Surana highlighted many major discounts and cuttings which should be retained or started to increase its appeal:
Standard deduction (section 16 (iA)): Under the standard deduction in the Old Tax Regim, the limit of Rs 75,000 in the New Tax Reseam will benefit greatly to the employed people.
Let us know that during the budget in July last year, the government increased the standard deduction from Rs 50,000 to Rs 75000 under the New Tax Regime. But the standard deduction limit in the old tax system is still Rs 50000.
Family Pension (section 57 (ii)): Surana suggested to increase the deduction limit from Rs 15,000 (under Old Tax Regime) to Rs 25,000.
Second major cuttings: He advocated to maintain the cut for the Contribution in Agniveer Corpus Fund under Section 80CCCH (2) and Employer Contribution in NPS under Section 80CCD (2).
These exemption should be included in New Tax Regime
To make New Tax Reseam more taxpayer -friendly, tax experts recommend to start the following deductions:
Section 80C (Life Insurance and Investment): Permission to deducts for investment like LIC premium, PPF and NSC in New Tax Regime will promote financial security and savings.
Section 80D (Medical Insurance Premium): Throwing the need for health care after the epidemic, Surana says, “The new tax regime will become more attractive by allowing tax exemption on the premium of medical insurance.”
Section 80EEB (Electric Vehicle Loan Interest): Along with emphasizing electric mobility, he suggests the inclusion of this deduction in New Tax Regime to promote eco-friendly investment.
Tax experts say that “allowing tax exemption on interest of housing loans can be promoted to adopt the new tax system on a large scale”.
Taxpayers’ expectations from budget 2025
Individual taxpayers are expecting reforms to simplify taxation in this budget. Surana’s recommendations indicate the need for a unified tax system that can promote financial security and economic participation as well as deal with existing challenges. Waiting till February 1 to see whether these expectations will be fulfilled or not. will be. If the government wants most of the tax payers to select New Tax Reseam, then some changes will have to be made for this.