• Notification Date: 03-02-2024
• Notification No: N/A

Budget 2024: FM Nirmala Sitharaman’s Statement about Income Tax

Finance Minister Nirmala Sitharaman announced the Interim Budget for 2024 on Thursday. In her speech, FM Sitharaman highlighted that the return filers have swelled to 2.4 times in the last ten years and that the Centre appreciates the taxpayers "for their support". 

"I would like to assure the taxpayers that their contributions have been used wisely for the development of the country and the welfare of its people," she said. 

She highlighted that in the last five years, the focus of the government has been to improve the services of the taxpayers using reforms like faceless assessment, updated income tax returns and new Form 26AS. Due to this, the "average processing time of returns has been reduced from 93 days in the year 2013-14 to a mere ten days this year, thereby making refunds faster," she said. 

For the indirect taxes, Sitharaman said that the Goods and Services Tax (GST) has reduced the compliance burden. "The tax base of GST more than doubled and the average monthly gross GST collection has almost doubled to Rs 1.66 trillion, this year." 

Interim Budget: What did FM Sitharaman say on income tax rates? 

FM Sitharaman said, "Under the new tax scheme, there is now no tax liability for taxpayers with income up to Rs 7 lakh, up from Rs 2.2 lakh in the financial year 2013-14." 

However, she added that there were no tax proposals for direct as well as indirect taxes. 

"As for tax proposals, in keeping with the convention, I do not propose to make any changes relating to taxation and propose to retain the same tax rates for direct taxes and indirect taxes, including import duties," she said. 

Sitharaman, however, added that the Centre will withdraw outstanding direct tax demands up toRs 25,000 for the period up to financial year 2009-10 and up to Rs 10,000 for financial years 2010-11 to 2014-15.  

"This is expected to benefit about a crore taxpayers," she said.    

On the announcement, Jyoti Prakash Gadia, managing director at Resurgent India said, "The announcements about income tax relaxation and rationalisation of indirect taxes were much expected but the same proved to be unfortunately a part of wishful thinking only." 

"No changes in tax are surprising as the masses had faced the brunt of a fall in disposable income and this announcement could have appeased the masses. We are seeing a different form of Governance in India, which is positive for the long term," Divam Sharma, founder and fund manager at Green Portfolio, PMS, added. 

Ranen Banerjee, partner and leader economic advisory, PwC India, added, "There has been no change on the taxation front, and we will have to wait for the full budget for any changes, with the government sticking to the norm of not making major announcements in an interim budget."