Delhi, January 16: Finance Minister Nirmala Sitharaman is set to present Union Budget for 2023 in the Lok Sabha on February 1. There are expectations that the government will raise the income tax limit and provide relief to the middle class taxpayers, besides others. The taxpayers expect that the central government will give them some respite to help tackle inflation.

With the Lok Sabha Elections 2024 set to take place next year, centre may give some tax relief to salaried class to boost spending. We take a look at some of the expectations from budget regarding income tax slabs. Income Tax Slabs: Know Current Tax Rates for Individuals Under New and Old Tax Regimes Ahead of Budget 2023

Raise Standard Deduction

Salaried class is expecting enhancement of Standard deduction under section 16 for salaried employees from Rs 50,000/- to Rs. 1,00,000/- as it has not changed since Finance Act,2019 given the increasing effect of inflation. The salaried employees expect the raise in Standard deduction to ease the tax burden of the employees and keeping in mind the rate of inflation and purchasing power of the salaried individual which is dependent on salary available for disbursement. Budget 2023: National Real Estate Development Council Seeks Tax Breaks, Infrastructure Status and Push for Rental Housing

Increase Exemption Under 80C

Taxpayers expect that the deduction limit under section 80C should be raised from the current ₹1.5 lakh to ₹2.5 lakh in Budget 2023. Raising the limit of section 80C has been a long-standing demand of the salaried class. It was last hiked from ₹1 lakh to ₹1.5 lakh in the financial year 2014-15. It is important to note that this deduction under section 80C is available only to those who opt for the old tax regime while filing the income tax return.

Lower Tax Rates

The tax rate of 42.74 percent, inclusive of surcharge and cess, is among the highest in the world. Under the current regime, the highest tax slab is 30 percent for an individual with an income exceeding Rs 10 lakh. Taxpayers expect that the central government will lower the highest slab rate to 25 percent.

Raise Tax Exemption Limit

Taxpayers expect the government to raise the basic tax exemption limit from Rs 2.5 lakh to Rs 5 lakh. The salaried class wants the income tax exemption limit to increased to Rs 5 lakh in Budget 2023 so that individuals will have more disposable income in their hands. This will also boost consumption as more money will be left in the hands of consumers helping in economic growth.

Currently, individuals whose total income during the fiscal year exceeds the exemption limit of more than the gross total income of 2,50,000 are required to file income tax returns in accordance with the law.

(The above story first appeared on LatestLY on Jan 16, 2023 02:08 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).