The Ministry of Finance is likely to lay special emphasis on the middle class in order to boost the urban consumption in the economy, sources told Zee Business. The government plans to provide income tax relief to the salaried middle class, especially in the income tax slab of Rs 3 lakh to Rs 10 lakh, they said.

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

One option is to ensure only 5 per cent tax on income falling in the Rs 3 lakh-10 lakh tax slab, with the possibility of changing either the tax slab or the tax rate applicable to the slab, according to the sources. 

In the July 23 Budget, the first Union Budget of the Narendra Modi 3.0 administration, the middle class was among the four key areas in the spotlight: 

  • Employment
  • Skilling
  • MSMEs
  • Middle class

While presenting the Budget in Parliament, Finance Minister Nirmala Sitharaman announced Prime Minister Narendra Modi’s package of five schemes and initiatives to facilitate employment, skilling and other opportunities for 4.1 crore youth over a five-year period with a central outlay of Rs 2 lakh crore.

The Budget 2024-25 allocated Rs 1.48 lakh crore to education, employment and skilling.

Here are some of the key takeaways from the Budget 2024 that were likely aimed at the middle class:

  • The government said that under its PM Awas Yojana Urban 2.0 scheme, one crore urban poor and middle class families' housing needs would be addressed with an investment of Rs 10 lakh crore.
  • That included central assistance worth Rs 2.2 lakh crore in five years.
  • The government also envisaged a provision of interest subsidy to facilitate loans at affordable rates.  
  • The government raised the capital gains exemption limit by 25 per cent from Rs 1 lakh to Rs 1.25 lakh per year.
  • However, it announced a new tax rate of 12.5 per cent from 10 per cent, applicable to long-term gains on all financial and non-financial assets.