According to CNBC-Awaaz, taxpayers can save up to 50,000-80,000 in income tax liability. Two announcements can be seen during the budget, the first of which is under the old system of income tax, which is called the Old Regime, and the second under the new system.
These changes can happen in the new regime
Last year, the government launched a new regime. In this regime, some changes in slab rates are possible, which can make it more attractive. It is expected to keep the slab rates in such a way that people leave the old system and adopt the new system. This will give income tax exemption.
– CNBC-AWAAZ (@CNBC_Awaaz) January 27, 2021
According to CNBC-Voice sources, standard deduction in old slabs may increase. Let me tell you that the standard deduction is currently Rs 50,000. At the same time, it is possible to consider increasing the tax exemption on homelones in this budget. During the preparation of the budget, these proposals have been discussed seriously.
Under the new tax regime, donors can get the benefit of deduction. The government can take these steps in the budget to promote donations for national and social reasons. In fact, in the budget last year, a slab with low tax rates was announced for taxpayers as an alternative, but most deductions including 80G were abolished in this system.
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The new system was introduced last year
In last year’s Union Budget, Finance Minister Nirmala Sitharaman introduced a new income tax system in which seven tax slabs were included. Zero, 5%, 10%, 15%, 20%, 25% and 30%. Whereas the old tax rule included four slabs zero, 5%, 20% and 30%. Both these tax rules were in force for the taxpayer. Although the tax rates on income between 5 lakh and 15 lakh rupees are low in the new income tax system, there will be no tax exemption and deduction.
Deduction at 80C
Currently under Income Tax Act 80CCE, income under Section 80C, 80CCC and 80CCD (1) is exempt from income tax on a total income of Rs 1.50 lakh a year. This will make people more attracted to savings. Let us know that many tax savings investments come under this section. People are expecting the finance minister to increase it to Rs 3 lakh.