What Budget 2024-25 Means For You

Finance Minister Nirmala Sitharaman announced a few changes in the new tax regime, while leaving the old one untouched. The government also increased taxes on long-term capital gains. We decode what the Budget means for you

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When finance minister Nirmala Sitharaman reached Parliament with her red folder, which she has been carrying since 2019 when she presented her first Budget, and departed from using the traditional suitcase that other FMs carried before her, individuals waited with bated breath for substantial tax relief on salaries and investments.

That’s because the new tax regime doesn’t offer benefits other than the standard deduction, and the popular Section 80C benefits under the Income-tax Act, 1961, hasn’t seen the limit increased since 2014. Also, the introduction of long-term capital gains (LTCG) tax of 10 per cent in Budget 2018 has been upsetting investors, who did not have to pay this tax since 2004 when LTCG tax was removed though securities transaction tax (STT) was levied on the gains. None of the two expectations saw fruition as Sitharaman had some other plans.

The Budget didn’t fulfil expectations and doesn’t offer a lot of benefits to the salaried class, but some of the measures may simplify taxpayers’ lives in the long term. Let’s look at the major announcements in detail and how they affect your money life.

Personal Tax

Slab Rates And Deduction:

Sitharaman hasn’t tinkered with the slab rates of the old tax regime for the last seven years. On the other hand, the new tax regime slab rates have been changed once, in 2023. This year too she has slightly tinkered with the slab rates in the new regime, while keeping the old tax regime unchanged (See Income Tax Slabs).

She has also increased the standard deduction from ₹ 50,000 to ₹ 75,000 for salaried taxpayers in the new tax regime, but not for the old regime for which it stays at ₹ 50,000.