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Income Tax Exemption Limit Likely To Be Enhanced To Rs 5 Lakh

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Last Updated: December 30, 2022, 19:41 IST

The Finance Ministry is mulling to increase the exemption limits from present Rs 2.5 lakh to Rs 5 lakh

The Finance Ministry is mulling to increase the exemption limits from present Rs 2.5 lakh to Rs 5 lakh

Senior citizens between the age group of 60-80 have an exemption threshold of Rs 3 lakh while for citizens above the age of 80 the exemption limit is Rs 5 lakh.

The government is likely to announce an increase in the income tax exemption limits in the upcoming Union Budget. According to reports, the Finance Ministry is mulling to increase the exemption limits from present Rs 2.5 lakh to Rs 5 lakh, amid the discussions with the stakeholders ahead of the Budget 2023.

If reports are to be believed, the proposal is aimed at increasing the disposable income in the hands of the taxpayers, which can induce consumption and boost economic growth.

As per the existing income tax norms, the exemption limit is Rs 2.5 lakh while the exemption limit for senior citizens above 60 years and upto 80 years is Rs 3 lakh. The exemption limit for elderly taxpayers above the age of 80 years is Rs 5 lakh.

Finance Minister Nirmala Sitharaman has already indicated that Budget 2023 will follow the spirit of the previous budget and will be a step to push growth on the back of public spending.

From industrialists to salaried class, all are expecting the government to roll out people friendly schemes and announce some sops as this is going to be the last full budget ahead of the election year.

It is important to note that the upcoming budget will be the last complete budget before the general elections scheduled for April–May 2024. It will be the fifth for the Modi 2.0 government and FM Sitharaman.

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