Here are 4 ways the Budget 2023-24 will affect your finances

Introduction

Despite the economy slowing down, inflation rising, and interest rates increasing, the market expected a populist budget with little room for executive action. However, the government has brought it to a new level of growth and stability with a well-balanced approach. An increase in capital expenditure of 33 per cent to Rs 10 lakh crore may result in a multiplier effect and boost the economy.

Besides, the Budget for 2023-24 was presented by Finance Minister Nirmala Sitharaman, which lowered tax rates for individuals and put more money in their pockets.

Below are some ways Budget 2023-24 will affect your finances.

1.      Reasonable cut for the taxpayer in the mid bracket

Under the new regime, the rebate increases to Rs 7 lakh from Rs 5 lakh and the slab increase to Rs 3 lakh from Rs 25 lakh. Also, an annual benefit of Rs 37,500 will be received by a taxpayer with an income of 15 lakh. It may be a step to encourage taxpayers to switch to the new tax regime. Furthermore, the new income tax regime has become the default.

Here’s the Income tax slabs and rates as per the new tax regime

2.      More money in hand to spend

With the New Tax Regime, you pay no tax on income up to Rs 3 lakh. As cited by the minister, a taxpayer with Rs 9 lakh in annual income will have to pay Rs 45,000 under the revised tax regime. This is 25% less than what he or she currently has to pay, which is Rs 60,000. Financial experts say Budget 2023-24 aimed at higher tax savings will promote personal consumption.

3.      Limit to income tax exemption on high-value life insurances

Taxable income will be generated from insurance policies (other than ULIPs) issued after 1st April 2023 with aggregate premiums exceeding Rs 5 lakh.

4.      Deduction on capital gains from property sales limited

Reinvested proceeds from the sale of a property were eligible for capital gains deductions. Under sections 54 and 54F, the finance minister proposes a cap of Rs 10 crore. Thus, it is likely that high-value real estate will take longer to sell.

Conclusion

In her Budget 23-24 proposal, FM Nirmala Sitharaman insists that saving and spending go hand in hand, and she intends to help Indians manage their finances better.