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The government is anticipated to put its attention on improving the nation's infrastructure while also announcing tax benefits for the general public.
Budget 2023: 5 Major Announcements Expected From Union Budget 2023
Union finances 2023 will be presented through union finance minister Nirmala sitharaman on 1st February 2023. The authorities are expected to position their interest on enhancing the country’s infrastructure even as also announcing tax blessings for most of the people.
All eyes are on how the government plans its expenditure and manages the fiscal deficit and inflation. If the government spends more on capital and revenue than expected, the fiscal deficit is likely to grow. This could result in increased government market borrowing, putting pressure on interest rates and triggering inflation.
Here is 5 major announcement expected from this Union Budget 2023:
Changes in Tax Slab
Individual taxpayers have a basic exemption limit of 2.5 lakhs under the current tax slab, which has not changed since 2014-15. Individuals with income below this threshold are not required to file income tax returns. In the upcoming budget, the income tax exemption limit is expected to be raised to 5 lakhs.
Increase in Standard Deduction
Taxpayers anticipate that the government will increase the standard deduction from Rs.50,000 to Rs.1 lakh. Experts believe that the standard deduction limit should be doubled to account for rising living costs and inflation.
Lowering the Fiscal Deficit
According to Goldman Sachs Group, India may reduce its fiscal deficit target by 50 basis points for the next financial year beginning 1 April 2023. In a report, Goldman economists Andrew Tilton and Santanu Sengupta predicted that India’s fiscal deficit would remain at 5.9 percent of GDP in the coming financial year.
As per the economists, the central government will increase welfare spending while maintaining capital expenditure. “Rural employment and housing are likely to be on the agenda,” the economists predicted.
Increase in Infrastructure and Social Schemes Spending
Increased infrastructure spending is also expected in this year’s budget. Large infrastructure projects are likely to be launched as a result of this in the coming years. Because this is the budget for the general elections in 2024, the government is expected to allocate more funds for infrastructure projects and social welfare schemes.
Increase in Deduction Limit for Home Loans
Section 24 (b) of the Income Tax Act allows taxpayers to deduct the interest paid on a home loan. However, such a deduction is limited to Rs.2 lakh per year. With the recent increase in property prices, the deduction limit is likely to be increased.
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