New Delhi: In what could come as a major disappointment for individual taxpayers, Finance Minister Nirmala Sitharaman has not announced any changes in the tax slab in the Union Budget 2021.
The FM was widely expected to provide relief to the pandemic-hit common man for which her announcement on individual taxation was eagerly waited. Sitharaman however offered a bit of relief for the Senior citizens, stating that those above 75 years of age with only pension income are exempted from filing tax returns.
The FM also offered some relaxation to home buyers by announcing extention for Rs 1.5 lakh deduction on payment of interest for affordable housing by 1 year.
In FMs's other major announcements under taxation, Sitharaman said that the government proposes to make income tax appellate tribunals faceless. It will set up national income tax appellate tribunal centre. The government has also cut timeline for reopening of tax cases to 3 years from 6 years.
Meawhile, Tax holiday for startups has been extended by 1 year while exemption on capital gains on investment in startups has also been extended by 1 year.
Advance tax liability on dividend income shall arise only after payment of dividend, the FM said. Exemption from tax audit limit doubled to Rs 10 crore turnover for companies doing most of their business through digital modes.
The pandemic struck at a time when the economy was already caught in the grip of a growth slowdown. GDP growth touched an 11-year low of 4 per cent in 2019-20. Also, since last budget, the size of the economy has reduced from Rs 2.24 lakh crore nominal GDP considered in the FY21 budget to Rs 1.94 lakh crore. There has been lower-than-budgeted revenue growth and higher expenditure to offset the adverse impact of the pandemic.
Among the most-watched figures in the budget was on the expenditure on vaccination in FY22 which could be shared among the central government, state governments and households. FM Sitharaman has announced Rs 35,000 crore towards COVID-19 vaccination in 2021-22 fiscal.
"I have provided Rs 35,000 crore for COVID-19 vaccine in this year 2021-22. I'm committed to provide further funds if required. The Budget outlay for health and well being is Rs 2.23 lakh crore in 2021-22 as against BE of Rs 94,452 crore and marks an increase of 137 per cent," she said while presenting 2021-22 Budget in the Lok Sabha.