Finance Minister Nirmala Sitharaman discusses tax relief plans for middle-class taxpayers, including income tax reductions and benefits for housing and education.
Proposed Tax Reforms for Middle-Class Taxpayers
Finance Minister Nirmala Sitharaman acknowledged the challenges faced by middle-class taxpayers and highlighted tax adjustments introduced in the last budget. She announced an increase in the standard deduction from ₹50,000 to ₹75,000 to provide financial relief. The government is also considering broader income tax reductions for individuals earning up to ₹15 lakh annually, potentially easing the burden on millions of urban taxpayers.
Impact of Tax Changes on Income Groups
Under the 2020 tax regime, incomes between ₹3 lakh and ₹15 lakh are taxed at rates ranging from 5% to 20%, with incomes above ₹15 lakh taxed at 30%. Proposed changes could bring further relief to those opting for this system, although exemptions like housing rentals remain excluded. The reforms aim to stimulate spending and boost economic growth amid slowing consumption and rising living costs.
Tax relief plans and additional Benefits for Education and Housing
Apart from tax cuts, Sitharaman emphasized initiatives to ease financial pressure on families, including subsidized interest rates for student loans up to ₹10 lakh and incentives for affordable housing. These measures reflect the government’s efforts to support economic recovery while addressing the middle class’s financial needs.
