Budget 2024 Highlights: No Changes in Income Tax Rates, Nirmala Sitharaman's Interim Budget Revealed

In a significant announcement during the presentation of the interim budget for 2024, Finance Minister Nirmala Sitharaman confirmed that there will be no changes in the income tax slabs and rates. As the country gears up for the 2024 Lok Sabha elections, taxpayers will continue under the existing tax regime with no relief in income tax rates.

Sitharaman emphasized the continuity of the current tax structure, both direct and indirect, as she presented the interim budget. "I propose to retain the same tax rates for direct and indirect taxes, including import duties," stated the finance minister. This decision means that there will be no alterations to the income tax slabs and rates, maintaining the status quo for taxpayers.

Despite being an interim budget, a tradition in every election year, Sitharaman assured that tax benefits for startups would be extended until March 31, 2025. However, the budget refrained from introducing any major changes, keeping the focus on maintaining stability during this transitional period.

Addressing the taxpayers, Sitharaman acknowledged their significant contributions over the last decade. She stated, "Over the last ten years, the direct tax collections have more than trebled, and the return filers swelled to 2.4 times. I would like to assure the taxpayers that their contributions have been used wisely for the development of the country and welfare of its people. I appreciate the taxpayers for their support."

Providing insights into the government's efforts to improve the tax system, Sitharaman highlighted several measures taken in the last five years. The introduction of Faceless Assessment and Appeal transformed the age-old jurisdiction-based assessment system, enhancing efficiency, transparency, and accountability. Additionally, the minister mentioned the reduction in corporate tax rates, simplification of tax returns filing with updated forms, and the significant decrease in the average processing time for returns.

"In the last five years, our focus has been to improve taxpayer services. The age-old jurisdiction-based assessment system was transformed with the introduction of Faceless Assessment and Appeal, thereby imparting greater efficiency, transparency, and accountability," Sitharaman stated. "Introduction of updated income tax returns, a new Form 26AS, and prefilling of tax returns have made filing of tax returns simpler and easier. Average processing time of returns has been reduced from 93 days in the year 2013-14 to a mere ten days this year, thereby making refunds faster."

Commenting on the Finance Minister's decision, Mr. Edul Patel, CEO of Mudrex, remarked, "The decision to keep tax rates unchanged sends a message of stability. However, the long-term impact will depend on the government's ability to manage fiscal challenges and promote sustainable economic development through other policy measures. As the interim budget sets the tone for the upcoming fiscal year, it will be interesting to observe how these decisions play out in the broader economic landscape."