Budget 2024 income tax expectations: Modi government may lower personal tax rates, says report - top 5 points

| TOI Business Desk | TIMESOFINDIA.COM | Jun 17, 2024, 16:04 IST

Budget 2024 income tax expectations: The Modi government is consi... Read More

Budget 2024 income tax expectations: The Modi government is mulling over the possibility of reducing personal tax rates for specific groups of individuals, according to two government sources who spoke to Reuters. This move has the potential to stimulate consumption in India, which is the third-largest economy in Asia.

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The sources, who requested anonymity due to the confidential nature of budget discussions, indicated that the plan might be unveiled in July when Finance Minister Nirmala Sitharaman presents the first Union Budget following the Modi 3.0 government.

Budget 2024 Income Tax Expectations

The sources told Reuters that a reduction in personal tax could boost consumption and increase savings for the middle class. The first source mentioned that individuals earning over Rs 15 lakh ($17,960.42) annually, up to a certain undetermined amount, may receive some tax relief.
The changes could be made to the new income tax regime introduced in 2020, where annual income up to Rs 15 lakh is taxed at rates between 5% and 20%, while earnings over Rs 15 lakh are taxed at 30%.
The second source pointed out that the personal tax rate increases six-fold when an individual's income rises from Rs 300,000 to Rs 15 lakh, which they described as "quite steep."
The government may also consider lowering personal tax rates for annual incomes of Rs 10 lakh, according to the first source. They added that a new threshold is being discussed for income taxed at the highest rate of 30% under the old tax system.
The second source noted that any loss of tax income to the government through tax cuts could be partially offset by increased consumption from this category of income earners.

Also Check | Income Tax Slabs FY 2024-25 Explained: New Tax Regime Vs Old Tax Regime - What are the tax rates, slabs & surcharge rates? Find out

Although the Indian economy expanded at an impressive 8.2% in 2023-24, consumption growth has been only half that rate. During his claim to form the National Democratic Alliance-led government, Prime Minister Modi had stated that his administration would prioritize increasing middle-class savings and enhancing their quality of life, the Reuters report said.

Top 10 Richest Countries In The World By GDP Per Capita 2024

Top 10 Richest Countries In The World By GDP Per Capita (PPP) 2024: Did you know that only one country in the list of world’s top 10 largest economies by GDP makes it to the list of richest countries by GDP per capita in purchasing power parity (PPP) terms? Yet another interesting fact is that Luxembourg, which tops the list, has a GDP per capita of more than 1.5 times that of the USA! And where does India, the world’s fifth largest economy rank? We take a look at the top 10 countries in the world by GDP per capita in PPP terms as per IMF’s World Economic Outlook April 2024 data sourced from EY: (AI image)

Luxembourg, a small European country, tops the list of world’s economies ranked in terms of GDP per capita (PPP). According to the IMF, Luxembourg’s GDP per capita is projected at $1,43,742.69 for 2024. (AI image)

Ireland, a member of the European Union, ranks second in the list of the top 10 richest countries by GDP per capita. As per IMF estimates in 2024, Ireland’s GDP per capita is expected to be $1,33,895.315. (AI image)

Singapore, the island country in Asia, is the third richest country in the world in terms of GDP per capita. For 2024, the IMF has projected that Singapore’s GDP per capita would be around $1,33,737.469. (AI image)

Macao, a special administrative region of China, has the fourth highest GDP per capita (PPP terms) in the world. According to the IMF, Macao SAR’s GDP per capita is projected at $1,34,140.929 for 2024. (AI image)

Qatar, a middle-east country, features on the 5th spot in the list of top 10 countries with highest GDP per capita (PPP). The IMF has projected the GDP per capita of Qatar at $1,12,282.917 for 2024. (AI image)

The United Arab Emirates or UAE, another middle-eastern country, is the 6th richest country in the world in GDP per capita terms. The IMF estimates that for 2024, UAE’s GDP per capita would be around $96,845.849. (AI image)

Switzerland, the popular European tourist-destination country, has the 7th highest GDP per capita in PPP terms. As per IMF’s estimates, in 2024 Switzerland’s GDP per capita is projected at $91,931.752. (AI image)

San Marino, a mountainous country in Europe, is the 8th richest country in the world in GDP per capita terms. According to the IMF, San Marino’s GDP per capita (PPP) is estimated to be $86,988.999 for 2024. (AI image)

The United States of America, which is the world’s largest economy in terms of GDP, ranks 9th when it comes to the GDP per capita (PPP) list. The IMF estimates that for 2024, America’s GDP per capita is projected at $85,372.686. (AI image)

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Top Comment

brajtvm NAIR

203 days ago

The FM has never done anything for the working and middle class during her entire tenure. The failure of the party to get majority is a reflection of her action and deeds. Hope she reforms and does something for the poor and middle class, otherwise it be difficult times for the BJP ahead.

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Budget 2024 income tax expectations: Modi government may lower personal tax rates, says report - top 5 points

Budget 2024 Income Tax Expectations

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