In this video Nitin Baijal, Director, Deloitte India is expressing his views on an expected personal income tax cut in the upcoming budget.
#UnionBudget2020 #Budget2020 #BudgetExpectations #TaxCut #OutlookMoney #Money #OutlookMagazine #OutlookGroup
#UnionBudget2020 #Budget2020 #BudgetExpectations #TaxCut #OutlookMoney #Money #OutlookMagazine #OutlookGroup
Category
🗞
NewsTranscript
00:00 Can you share your views and expectations from the budget, from a personal taxation
00:07 point of view?
00:08 Dr. Raghuram G. Rajan So, the past 3-4 months I have actually seen
00:10 a lot of speculation in and around what is going to happen on the personal tax rates.
00:16 I think there has been a lot of debate and a lot of internal thoughts which are there
00:21 within the policy makers that they want to tweak the personal tax rates.
00:25 If you ask me personally, I have got three points on the agenda.
00:29 First of course is the tweaking of personal tax rates.
00:32 What the policy makers should look at is that they should make the first slab which is Rs.
00:36 0 to 5 lakhs is totally exempted which is actually exempted for a few people, for a
00:41 certain category of people.
00:44 But I think this should be actually extended to all and sundry.
00:47 The next slab technically should run between Rs. 5 to about Rs. 20 lakhs which is at about
00:52 10% and then maybe Rs. 20 lakhs above at about 25%.
00:57 However, what the policy makers had done in the prior budget was that they had also increased
01:02 the surcharge and they wanted to tax the super rich.
01:05 I guess they should continue with taxing the super rich.
01:08 If we are able to achieve even this, then I think it is going to get a lot of cheer
01:13 amongst the community and people will be very happy with tweaking of these personal tax
01:18 rates.
01:19 That is point one.
01:20 Point two is more on the house property income.
01:24 So way back in 2017, there was a rollback that happened.
01:27 So earlier house property income was permitted to be set off and there was no cap on that.
01:33 There was a tweaking that happened in 2017 as a result of which the cap was made at about
01:38 Rs. 2 lakhs and therefore it certainly pinched the pocket of various people.
01:45 My thought is that that should be rolled back.
01:48 If it is possible that Rs. 2 lakhs cash should go away and particularly on the interest on
01:54 housing loan because people used to set that off and it was not restricted to Rs. 2 lakhs.
02:00 So if that is rolled back, it will be a big breather for a lot of people.
02:04 And last but not the least, ATC.
02:07 I think that is something which has been in the offing for a fairly long time.
02:11 If you step back into 2014, that is the time when we actually saw some change happening
02:16 in ATC and ATC is actually something which is important right from a person who is a
02:22 CEO even to maybe a security guard.
02:24 So ATC investment is something which everybody does.
02:27 We have seen that that number stays at about Rs. 1,50,000.
02:31 My expectation is that that should certainly go up to about Rs. 3 lakhs because the intention
02:36 is actually to give more and more disposable income in the hands of the common man and
02:40 the individual.
02:41 And then that can be achieved by virtue of tweaking of this ATC which the number can
02:46 be made at about Rs. 3 lakhs and I have talked about personal tax rate because that will
02:50 actually give you a lot of disposable income in the hands.
02:53 NPA should be over and above that Rs. 3 lakhs.
02:56 Way back I think in 2011 or something we had the infrastructure bond which had been introduced
03:02 which were a part and parcel of ATC but they were rolled back.
03:05 I think infrastructure bonds should also come back because that is something which with
03:10 the government focus on infrastructure, you know that will also help boosting the infrastructure
03:14 plus people can invest.
03:15 So I am saying Rs. 3 lakhs plus maybe about a lakh lakh Rs. 50,000 on infrastructure and
03:20 about Rs. 50,000 NPA.
03:21 So overall this gives a combined package.
03:24 While these three points which I have put through as the agenda work well but then we
03:30 need to bear in mind that this will certainly have some impact on the government coffers.
03:33 But having said that, overall it may have the impact on government coffers but there
03:38 will be increased compliance, there will be more disposable income in the hands of the
03:43 people and of course more and more purchasing power and then it will help boosting the economy
03:48 overall.
03:49 that is about it. Thanks.
03:50 [BLANK_AUDIO]