Budget 2022: Salaried class expect Rs 50,000 WFH bonus; tax slab, standard deduction changes

Nirmala Sitharaman will present the Union Budget on Febraury 1, 2022.

New Delhi: Finance Minister Nirmala Sitharaman is all set to present the Union Budget for financial year 2022-23 on Febraury 1, 2022. Salaried class is hoping the finance miniter to hike the income tax slab, introduce work from home allowances, and increase standard deduction, among others. 

Here are the expectations of salaried class from Budget 2022:  

Work From Home Allowance 

IT industry professionals have long been demanding a Work From Home allowance. Reiterating their demands, Deloitte India has recommended a Rs 50,000 additional ‘work from home’ bonus. 

“Considering the current situation, employees are working from home across businesses. Employees are likely to incur additional 'work from home-related expenditure', such as internet charges, rent, electricity, furniture, etc., and therefore, employers would need to provide allowances to meet these expenditures,” Deloitte India said. 

Hiking the Income Tax Slab

Deloitte India has also recommended the Centre to increase the threshold for the highest tax rate from Rs 10 lakh to Rs 20 lakh. 

"To align individual tax rates with corporate tax rate, it is advisable to reduce the highest tax rate of 30% to 25%... Therefore, the proposed highest slab rate (including surcharge and cess) can be reduced to 35.6% from 42.7%," Deloitte India said.

Simplification of Tax

The Central government had introduced the the Equity Linked Savings Scheme (ELSS) category of savings to provide more investment options to the investors. Salaried individuals are expecting the government to introduce tax reforms to make investment more simplet.

Universal Health Insurance

Benefits and need of insurance (specially health insurance) was felt by every Indian during the pandemic. Dr Arun Singh, Global Chief Economist, Dun & Bradstreet, said, “Government may aim for universal health insurance albeit through direct funding by incentivizing private insurance sector. Measures such an increase in the tax deduction limits and exemption from GST on insurance premiums, to improve social protection are expected.”

Save more with home loans 

The Centre could reportedly consider hiking the annual tax deduction limit for repayment of home loan principal from the current cap of Rs 1.5 lakh to Rs 2 lakh. The benefits are provided to taxpaying home buyers under Section 80C of the Income Tax act. The Union Budget 2022 could also introduce changes in income tax slabs and increase exemptions under sections 80C, 80EE, 80EEA and 24(b) of the Income Tax Act. Also Read: Budget 2022 shouldn't focus on fiscal consolidation alone: SBI economists

Increasing the Standard Deduction Limit 

With the Budget 2022, the government could also increase the standard deduction limit. Currently, the limit is capped at Rs 50,000, that was introduced in 2019’s interim budget. The government had increased the standard deduction to Rs 40,000 in 2018. Also Read: Aadhaar Update: UIDAI cautions against use of PVC Aadhaar from market; check how to order valid card