Union Budget 2023: In the upcoming budget for 2023–24, the Union government is allegedly expected to increase the income tax exemption limit from the current Rs 2.5 lakh to Rs 5 lakh. If this comes into being, the consumers will have more disposable income in their hands.
Additionally, it would also enhance consumption, which could help the economy to recover, sources privy to developments said. They further claimed that the move would also promote investments.
Income tax slab
As of now, the maximum slab of income which is exempted from the purview of income tax is Rs 2.5 lakh.
Notably, the exemption threshold is Rs 3 lakh for people between the ages of 60 and 80, and Rs 5 lakh for senior citizens over the age of 80. According to sources, the move would also promote investments.
It should be noted here that Finance Minister Nirmala Sitharaman is expected to present the Union budget for 2023-24, on February 1, 2023.
The upcoming budget will 'follow the spirit' of previous ones: Sitharaman
Meanwhile, Sitharaman recently hinted that the forthcoming Union Budget will continue to push growth on the back of public spending, and will "follow the spirit" of previous budgets. She also unveiled a massive public spending programme to support the economy, emerging out of the Covid-19 pandemic.
The finance minister had also raised capital expenditure by 35.4% for the financial year 2022-23 to Rs 7.5 lakh crore to boost demand, while the capex last year stood at Rs 5.5 lakh crore.
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The GDP growth has slowed in recent months due to global headwinds and rising interest rates globally to control spiralling inflation. This has prompted some to seek a further government push to revive the growth rate.
The budget 2023-24 will be presented in the backdrop of many institutions, including the Reserve Bank, slashing India's growth forecast to 6.8 per cent or so for the current fiscal. The RBI projected the real GDP growth for 2022-23 at 6.8 per cent, with the third quarter at 4.4 per cent and the fourth at 4.2%
It is worth mentioning here that the forthcoming budget will be the 5th one for the Modi 2.0 government and Sitharaman, and the last full budget before the general elections slated in April-May 2024.
(With inputs from agencies)
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