In the Union Budget 2024, Finance Minister Nirmala Sitharaman unveiled significant changes aimed at benefiting salaried individuals, investors, and foreign companies. Here are the key highlights:
Standard Deduction Increase
The standard deduction for salaried individuals under the new tax regime has been increased from ₹50,000 to ₹75,000. This change is expected to provide significant relief to middle-income earners.
Tax Appeal Limits Raised
Sitharaman announced increased monetary limits for filing tax appeals:
- ₹60 lakh for the Income Tax Appellate Tribunal (ITAT)
- ₹2 crore for High Courts
- ₹5 crore for the Supreme Court
Angel Tax Abolished
In a move to encourage investment, the Finance Minister proposed abolishing the Angel Tax for all types of investors. This decision aims to make the investment climate more favorable.
Corporate Tax Rate Reduction
The corporate tax rate for foreign companies will be reduced from 40% to 35%, enhancing India’s attractiveness as a business destination.
Family Pension Deduction Increased
The deduction for family pensions has been increased from ₹15,000 to ₹25,000, offering greater financial support to families.
Revised Tax Slabs
The new tax regime will feature the following revised slabs:
- Income up to ₹3 lakh: 0%
- ₹3-7 lakh: 5%
- ₹7-10 lakh: 10%
- ₹10-12 lakh: 15%
- ₹12-15 lakh: 20%
- Over ₹15 lakh: 30%
Incentives for Foreign Cruise Companies
To attract tourism, a simpler tax regime for foreign cruise companies operating in India has been introduced.
Support for Diamond Cutting Industry
The diamond cutting industry will benefit from new safe harbor rates for companies, promoting growth in this sector.
TDS on E-Commerce Reduced
The Tax Deducted at Source (TDS) on e-commerce transactions will be reduced from 1% to 0.1%, simplifying tax compliance for online businesses.
Import Duty Reduction
Basic Customs Duty (BCD) on mobile phones, mobile PCBs, and mobile chargers will be reduced to 15%, making electronic goods more affordable.
Space Economy Boost
The government has proposed setting up a ₹1,000 crore venture capital fund to support the space economy, fostering innovation and growth in this high-potential sector.
Comprehensive Review of Income Tax Act
Sitharaman announced a comprehensive review of the Income Tax Act of 1961, aimed at reducing disputes and litigation. This review is expected to be completed within six months.