In this budget, the basic exemption limit can be increased from Rs 2.5 lakh to Rs 3 lakh. Due to this, money will come in the pockets of the people affected by job loss due to Corona.
Budget 2022: Between the third wave of the COVID-19 epidemic and the assembly elections, the Union Budget 2022 is going to be presented on February 1, so the common man has many expectations from this budget. In Budget 2022, populist measures can be taken to appease voters due to assembly elections. Necessary steps should be taken by the government in Budget 2022 to support the economy amidst the Omicron variant of the corona virus and rising inflation. In such a time, preparing a balanced budget is definitely a difficult task for the Finance Minister. The common man is expected to get tax relief and increase in savings through Budget 2022. In the upcoming assembly elections, the government will not take the common man lightly. Let us see what are the expectations of a common man from the budget 2022.
Basic exemption limit expected to be increased
This is also an expectation of the common man from the budget. It is expected that in this budget, the government will increase the basic exemption limit from Rs 2.5 lakh to Rs 3 lakh. Due to this less income and job loss, more money will come in the pockets of the affected people after Corona. Incentive for homebuyers: There is a boom in investment in the real estate market. Due to the stable monetary policy of RBI, the housing loan rates are the lowest level ever. Any kind of incentive in this sector will benefit other industries associated with it and employment and development opportunities will be created for MSMEs and SMEs.
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LTCG tax relief expected
Stock markets and mutual fund investors separately expect relief in Long Term Capital Gains (LTCG) tax. Experts believe that the abolition of LTCG tax on the sale of listed equity shares in India will encourage investment through stock exchanges. Till Budget 2018, long term capital gains were tax free for investors. Currently, long term capital gains up to Rs 1 lakh in a financial year are tax free. After that tax is levied at the rate of 10 per cent. Removal of this capital gains tax or raising the existing exemption limit of Rs 1 lakh at least in a year will boost investment through stock exchanges.
Expected removal of STT on equity investments:
STT is a direct tax levied on the purchase and sale of securities listed on the stock exchanges. Experts believe that abolition of the Securities Transaction Tax on equity trade should be considered in the Budget 2022. There is no point in levying LTCG, STT and GST on every transaction made by the investor. To encourage new investors in the financial markets, it is necessary to abolish STT.
Expected changes in tax rules related to cryptocurrencies
A bill to regulate cryptocurrencies was expected to be introduced during the winter session of Parliament, however it was not introduced. Now it is expected that the government can introduce a bill in the budget session. However, crypto industry sources, investors and traders expect a proper tax policy framework on crypto earnings in the upcoming Budget 2022. Tax experts are hopeful that in the upcoming budget, the government can clear the confusion over the taxation of income from cryptocurrencies. At present, there is no specific provision in the Income Tax Act regarding tax on income from cryptocurrencies. Archit Gupta, Founder and CEO, ClearTax, says, “There are many confusions regarding the tax rules related to crypto. For example, decisions can be taken in this budget on things like its classification, applicable tax rates, TDS/TCS and GST on the purchase and sale of cryptocurrencies.
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Startups expected to be promoted
Indian startups have raised more than $ 4200 million in the year 2021, which has led to the formation of more than 45 unicorn companies (companies with a valuation of $ 100 million). The government has announced that the Department for Promotion of Industry and Internal Trade (DPIIT) is working on creating 20 lakh new jobs. For this, 50,000 new start-ups will be officially registered in the next four years. Now what is needed is a start-up friendly policy and tax relief, so that spending in research and innovation is encouraged.
(The author Anupama Bhargava is a Financial Strategist. The views expressed here are personal and Financial Express Online takes no responsibility for the same.)
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