Budget: A summary of key tax changes announced in past budgets

Finance Minister Nirmala Sitharaman is scheduled to unveil the Union Budget for the fiscal year 2024-25 on February 1. As has been the annual tradition, both financial experts and the general public are anticipating significant announcements related to taxation. Over the years, the government has implemented notable modifications to income tax-regulations.

Here is a brief summary of key tax changes introduced in the Union Budgets, starting from 2019-20:

UNION BUDGET 2023-24

• Aim to maintain continuity and stability of taxation
• Further simplify and rationalize various provisions to reduce compliance burden
• Promote entrepreneurial spirit and provide tax relief to citizens
• Constant endeavor to improve Tax Payers Services
• Making compliance easy and smooth
• Proposal to roll out a new form for tax payer convenience
• Plans to strengthen the grievance redressal mechanism
• Rebate limit of Personal Income Tax to be increased to Rs. 7 lakh
• Currently at Rs. 5 lakh in the new tax regime
• Individuals in the new regime with income up to Rs. 7 lakh will not pay any tax
• New personal income tax regime introduced in 2020 with six income slabs
• Proposed change to reduce the number of slabs to five
• Increase tax exemption limit to Rs. 3 lakh
• Significant relief for all tax payers in the new regime

UNION BUDGET 2022-23

• Vision for a reliable tax system
• Simplified tax structure, reduced litigation
• Introduction of 'Updated Return'
• Alternate Minimum Tax reduced from 18.5 per cent to 15 per cent
• Surcharge reduced from 12 per cent to 7 per cen for income between Rs 1 crore and Rs 10 crores
• Annuity/lump sum allowed for differently abled dependents
• Applicable to parents/guardians at age 60
• Deduction limit increased from 10 per cent to 14 per cent for State Govt. employees
• Parity with central govt. for social security benefits
• Incorporation period extended to 31.03.2023
• Tax benefits for eligible start-ups
• Last date for manufacturing under section 115BAB extended to 31.03.2024
• Specific tax regime introduced
• 30 per cent tax on income from asset transfer
• 1 per cent TDS on payments above threshold
• Appeal filing deferred for identical questions of law
• No set-off for loss against undisclosed income
• Exemption for non-residents' income
• Surcharge rationalisation
• No set-off for loss against undisclosed income
• Taxable treatment of benefits to agents
• Deduction for giver if value exceeds Rs 20,000 in the financial year

UNION BUDGET 2021-22 

• Corporate tax rate among the world's lowest
• Eased taxation for small taxpayers
• Doubled return filers to 6.48 crore in 2020
• Introduced Faceless Assessment and Appeal
• Exempted senior citizens over 75 from filing tax returns
• Reduced case reopening time to 3 years
• Set up Dispute Resolution Committee
• Established National Faceless IT Appellate Tribunal Centre
• Rs 85,000 crore tax disputes settled via Vivad Se Vishwas
• Relief for NRIs facing issues with foreign retirement accounts
• Increased turnover limit for digital transactions to Rs 10 crore
• Exempted REIT/InvIT dividends from TDS
• Allowed Infrastructure Debt Funds to issue Zero Coupon Bonds
• Extended tax benefits for affordable housing projects
• Tax incentives for IFSC in GIFT City
• Pre-filled returns for capital gains, dividends, etc.
• Raised limit for small charitable trusts to Rs 5 crore
• Disallowed deduction for late employee contribution deposits
• Extended tax holiday eligibility for startups
• Extended capital gains exemption for startup investments till March 2022

UNION BUDGET 2020-21

• Simplify tax structure, stimulate growth
• Middle-class relief.
• New regime optional.
• Pre-filled returns for simplicity.
• Estimated revenue forgone: Rs. 40,000 crore/year
• 15 per cent rate for new electricity companies
• Competitive global rates
• DDT removed
• Deduction for subsidiary dividends
• Estimated revenue forgone: Rs. 25,000 crore/year
• 100 per cent deduction for 3 of 10 years
• ESOP tax payment deferred
• Audit threshold increased to Rs. 5 crore
• Parity with corporate sector for cooperatives
• 100 per cent tax exemption for Sovereign Wealth Funds
• Extra deduction till 31st March 2021
• Extended approval date for tax holiday
• Online PAN via Aadhaar
• ‘Vivad Se Vishwas’ for tax litigations
• Faceless appeals and Taxpayers’ Charter
• Charity institutions: E-filing, URN issuance, provisional registration
• Amendments to benefit from unabsorbed losses and depreciation after amalgamation

UNION BUDGET 2019-2020

• Corporate tax rate reduced to 25 per cent for companies with annual turnover up to Rs. 400 crore
• Surcharge increased on individuals with taxable income exceeding Rs. 2 crore
• India's 'paying taxes' ranking improved from 172 in 2017 to 121 in 2019
• Increased by over 78 per cent in the past 5 years, reaching Rs. 11.37 lakh crore
• PAN and Aadhaar interchangeability
• Pre-filled Income-tax Returns introduced
• Faceless e-assessment launched for certain transactions
• Additional deduction of Rs. 1.5 lakhs for interest on loans for houses up to Rs. 45 lakh
• Rs. 1.5 lakh additional income tax deduction on interest for electric vehicle loans
• Customs duty exemption on certain EV parts
• Simplification of tax laws
• Relief for start-ups on capital gains and 'Angel tax'
• Tax on interest of bad debts for deposit-taking and systemically important NBFCs
• 100 per cen profit-linked deduction in any ten-year block
• Exemptions for dividend distribution tax, capital gains, and interest payments
• STT restricted to the difference between settlement and strike price for options