Prime Minister Narendra Modi government’s maiden Budget is unlikely to offer a lot to the salaried class. Sources tell CNBC-TV18 that the document may not announce any major exemptions for professionals due to lack of fiscal space. The governments “hands are tied” as there is limited room for big bold move in the Budgets. There are high hopes from the new government that it will raise tax slabs and also significantly hike the annual tax exemption limit to provide a much-needed relief to salaried class, which is reeling under the stubbornly high inflation. Sources say the finance ministry is wary of the impact of high exemptions on the fiscal gap. It will take at least two years to get economic revival on track. A hike in exemption from the currently Rs 2 lakh to Rs 5 lakh will cost the exchequer Rs 64,000 crore. While raising 80C deduction limit from Rs 1 lakh to Rs 3 lakh will lead to the government losing out on Rs 40,000 crore in tax revenues. utm_source=ref_article
Posted on: Mon, 07 Jul 2014 07:41:36 +0000
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