Finance Minister Nirmala Sitharaman said on Friday that the Narendra Modi government has granted various tax breaks to the middle class, including an income tax exemption of up to Rs 7.27 lakh per year. Asserting that the government has not excluded any segment of society, she cited scepticism in some quarters when it was decided to grant income tax exemption for people earning up to Rs 7 lakh in the Union Budget for 2023-24.
She was sceptical about what would happen to those profits of less than Rs 7 lakh.
Understanding Income Tax Slabs: Rs 7.27 lakh, you don’t pay…
“So, we sat as a team and went into the details (to find out) at what stage you pay tax for every additional Re 1 you earn… (for instance) for Rs 7.27 lakh, you don’t pay any tax now. It is only at Rs 27,000 that the break even comes. After that you start paying tax.
“You have a standard deduction of ₹50,000 also. Under the new scheme, the grievance was that there was no standard deduction. It is given now. We have brought in the simplicity in the paying rate and the compliance side,” Nirmala Sitharaman added.
Significant jump in MSME budget
While delving into the achievements of the Union Government, Nirmala Sitharaman mentioned the increased budget of the Micro Small and Medium Enterprises (MSME) sector which jumped to ₹22,138 crore for 2023-24 compared to ₹3,185 crore in 2013-14.
Nirmala Sitharaman said that the ‘Public Procurement Policy for Micro and Small Enterprises’ initiative has resulted in 33 percent of the overall procurement made by 158 Central Public Sector Enterprises coming from MSMEs. This achievement represents the highest proportion to date.’
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