Income Tax exemption limit change from Rs 2.5 lakh to Rs 5 lakh expected from Budget 2023 (2024)

Income Tax Exemption: ASSOCHAM has proposed that the Government should increase the tax exemption limit to Rs 5 lakh so that individuals will have more disposable income in their hands.

Union Budget 2023 expectations: The Income Tax exemption limit is currently Rs 2.5 lakh for the assessees. This means individuals earning up to Rs 2.5 lakh/year do not have to pay any taxes. Though taxable income up to Rs 5 lakh is also practically tax-free due to the rebate provided by Section 87A, income above Rs 5 lakh increases the tax liability of the individual taxpayer. Therefore, there is a demand for raising the income tax exemption limit from Rs 2.5 lakh to Rs 5 lakh.

Associated Chambers of Commerce and Industry of India (ASSOCHAM) has proposed that the Government should increase the income tax exemption limit to Rs 5 lakh in Budget 2023 so that individuals will have more disposable income in their hands.

The government should increase the exemption limit for income tax to at least Rs 5 lakh so that more disposable income is left in the hands of consumers and the economy gets a consumption boost and further leg-up in the recovery. Without accounting for rebates, the present exemption limit is Rs 2.5 lakh for the assessees, ASSOCHAM said in its pre-Budget recommendations.

Also Read: PPF investment limit change suggested by ICAI – Here’s why

Is it possible to raise the Income Tax Exemption limit?

During an interaction with the media on December 15, ASSOCHAM President Sumant Sinha said that buoyancy in both the direct and indirect taxes should give enough elbow room to the government for raising the income tax exemption limit.

”Boosting consumption by leaving more money in the hands of the consumers, is a low-hanging fruit for a further recovery in economic growth, ” said Deepak Sood, Secretary General ASSOCHAM.

Income Tax exemption limit change from Rs 2.5 lakh to Rs 5 lakh expected from Budget 2023 (5)

What it takes to get Rs 10 crore from SIP!

By Rajeev Kumar

Income Tax exemption limit change from Rs 2.5 lakh to Rs 5 lakh expected from Budget 2023 (6)

Best tax saving investments for 2023

By Rajeev Kumar

GST Relief

While suggesting another relief measure, ASSOCHAM said the interest for late payment of the GST should be reduced to 12 per cent from 18 per cent. ”The penal interest rate of 18 per cent is too high, particularly for the MSMEs,’ it said.

Also Read: Revised Income Tax Slab Rates and changes in Budget 2023 – Here’s what Deloitte expects

According to ASSOCHAM, India’s macro situation looks far more positive than most of the major economies. But we need to remain focused on growth. “The next year’s budget would be a catalyst for enabling India to be the fastest growing economy of the world. Our focus should be both boosting consumption and investment,” it said.

Income Tax exemption limit change from Rs 2.5 lakh to Rs 5 lakh expected from Budget 2023 (2024)
Top Articles
Latest Posts
Article information

Author: Dr. Pierre Goyette

Last Updated:

Views: 5727

Rating: 5 / 5 (50 voted)

Reviews: 89% of readers found this page helpful

Author information

Name: Dr. Pierre Goyette

Birthday: 1998-01-29

Address: Apt. 611 3357 Yong Plain, West Audra, IL 70053

Phone: +5819954278378

Job: Construction Director

Hobby: Embroidery, Creative writing, Shopping, Driving, Stand-up comedy, Coffee roasting, Scrapbooking

Introduction: My name is Dr. Pierre Goyette, I am a enchanting, powerful, jolly, rich, graceful, colorful, zany person who loves writing and wants to share my knowledge and understanding with you.