Expectations of taxpayers ahead of the Union Budget

As the Union Budget approaches, taxpayers, especially salaried individuals and retirees, are looking for further relief and simplification in the income tax system. Several expectations have emerged, particularly around tax slabs, deductions, and incentives under the new tax regime.

In the previous budget, annual income up to Rs 12 lakh was made tax-free, providing significant relief to the middle class. This year, there is growing speculation over whether the government may raise the tax-free income limit to Rs 15 lakh, further easing the burden on salaried taxpayers.

There is also anticipation that the government could simplify income tax slabs further, making the tax structure more transparent and taxpayer-friendly. Salaried individuals are hoping for additional relief measures, including a possible increase in the standard deduction from the current Rs 75,000 to Rs 1 lakh.

For retirees, expectations include tax benefits on fixed deposits, which remain a key investment option for senior citizens. Such measures could provide greater financial security for those dependent on interest income after retirement.

Another key area of focus is housing loans. While the old tax regime already offers deductions on home loan interest, there is hope that similar benefits could be extended to the new tax regime, making it more attractive for homebuyers.

There is also discussion around the future of the old tax regime. While an immediate withdrawal appears unlikely, the government may announce a timeline for its gradual phase-out, placing greater emphasis on strengthening and popularising the new tax regime.

Experts believe the government’s priority will be to make the new tax regime more appealing, in line with its broader goal of simplification and ease of compliance. Additionally, new announcements focused on Digital India and financial planning are expected, reflecting the government’s push toward a modern, technology-driven economy.

As expectations rise, taxpayers will be closely watching whether the budget delivers meaningful relief while balancing fiscal discipline.