The Union Budget 2022, which will be presented soon will be focusing on different aspects and sectors of the country. This time, each state including Kerala has its own expectations and is eagerly waiting and hoping for the move on the expected areas.
The common man (read as an honest taxpayer) feels that the government should provide some relief and bring cheer to their lives through a cordial budget. Relief in the income tax front is the key area of expectation. A hike in the standard deduction limit is clearly the common man’s request of finance minister Nirmala Sitharaman. Here are some of the expectations a common man put on this year’s budget:
- The top expectation for a common man who is a taxpayer is in the standard deduction. The standard deduction for salaried employees was reintroduced in FY 2018-19 after being scrapped in FY 2005-06. During the period of the Covid pandemic, the common man faced unexpected expenses than earlier along with the rising inflation in the previous years. Therefore, there is a need to increase the standard deduction from the current Rs 50,000 to Rs 1,00,000 and this will be on the top of the topic for a common man.
- This year, the budget may introduce tax-free work from home allowances for salaried employees. Allowing deductions for such expenses will raise the take-home salary, finally creating demand for goods and services in the country.
- One of the other expectations is for women entrepreneurs. The expectation is for the credit support and Covid incentive for women-led businesses. Some women entrepreneurs wish for provisions from the Center with additional tax benefits, subsidies, and interest-free loans.
- In this year’s budget, clarity is expected on the cryptocurrency bill taxation in the upcoming Union Budget 2022. “The crypto classification, applicable tax rates, GST implications, etc are a concern for the common man now, and expected that the budget would focus the concern and clarity would be made,” , said Abhishek Soni, co-founder, and chief executive officer, Tax2win.
- According to reports, a 4 day work week draft has been introduced by the government. The states are now asked to frame the rules for it. But there are many challenges for the common man when the 4-day workweek is introduced in India. Provident fund calculation will also be a matter of concern for the common man. In recent years, the government has decided to tax contributions to provident funds and interest earned on them. The new rule on PF contribution and interest compiled impacts adversely since the retirement corpus is taxed.
- The finance ministry may revise the personal income tax slab in this year’s Budget. Many experts believe that the two tax regimes still confuse the common man. “The government may consider increasing the highest tax slab to Rs.20 lakh from Rs 15 lakh or allow certain deductions to make the new regime more enticing. Budget 2021 did not provide any major relief to the salaried class,” Abhishek Soni explained, News18 reported.
Meanwhile, there are indications that the health sector will have more resources in this budget. Allocations are expected to increase by 10 to 15 percent. There is also the possibility of more start-ups in the pharmaceutical sector and more incentives for drug research.
It is the responsibility of the government to restore the unorganized sector that Covid destroyed. Suggestions for this will also be included in today’s budget. Moreover, it is learned that all bank deposits will be covered by insurance. At present, only 51 percent of the total bank deposits are covered.