We all have our expectations from the upcoming Union Budget, don’t we? So, we asked a few of the folks at BankBazaar about their expectations.
What are you expecting from Budget 2018? We asked a few of the folks at BankBazaar about their expectations. Here’s what they had to say:
“The last budget brought relief for people with income between Rs. 2.5 lakhs to Rs. 5 lakhs. However, the middle slab of people above Rs. 5 lakhs are having a tough time dealing with inflation and hoping for some relief in the tax rates. We expect the government to introduce a tax slab of 30% this year for people with income above Rs. 12 lakhs along with a 20% tax rate on income between Rs. 7 lakhs and Rs. 12 lakhs. Income up to Rs. 3 lakhs should be exempted from filing tax. And a 5% tax rate should be introduced for those with income ranging between Rs. 3 lakhs and Rs. 7 lakhs.
Apart from this, the exemption limit, especially for Section 80C, needs to be increased to somewhere between Rs. 2 lakhs to Rs. 3 lakhs. The government rejigging the tax slab will help infuse financial security and boost consumption.”
“Of course, all taxpayers, including women, would be looking for some tax relief in the form of higher tax slab limits across all categories of taxpayers – in a way that helps reduce the tax liability of individuals so that they have more disposable income that could boost consumption in the country.
Measures that boost savings and consumption would help too. An increase in the interest deduction limit on Housing Loans from the existing Rs. 2 lakhs would be very helpful, especially for financially-independent women looking to buying houses in their own names.”
“Solely from a Mutual Funds perspective, here are my key expectations from the Union Budget 2018:
Enhance Section 80C Limit: Many investors prefer ELSS as a smarter way to save taxes and create wealth. Currently, it offers a limit of Rs. 1.5 lakhs. Enhancing this limit will encourage investors to save more tax and help them plan their finances better
Debts Funds/Hybrid Funds to be a part of Section 80C: A Debt/Hybrid Fund that will qualify for tax deductions, like ELSS, will help the industry cater to the demands of conservative investors
Pension Plan by Mutual Funds: Mutual Funds should be allowed to launch pension funds, which will be a long-term retirement plan for retail investors
Removal of the Rs. 50K limit while investing through Aadhaar OTP: Currently, investors investing through eKYC have a limit of Rs. 50K per Mutual Fund per financial year. Aadhaar is supposed to be a universal KYC for all residents of India and hence removal of the limit can help in extending the reach of Mutual Funds.”
“Here are my expectations from the 2018 Budget. Firstly, I expect an increase in the income tax slab to help middle-income groups to save more. Also, an increased limit of tax-saving sections like 80C, 80C, 80CCC & 80CCD will be well appreciated. Another big concern is the completion of targeted infra projects on time. Mumbai is undergoing a bad phase due to delay in multiple infra projects execution, like the Mumbai Metro for instance.
Also, there should be a re-assessment of GST slabs for consumable goods. And finally, petroleum products should be included under the GST umbrella.”
“More than 50% of my salary goes away as taxes, income tax, service tax, or GST etc. What is the use of waiting for salary for an employee like me? Clearly, my expectations are simple. I hope there’s an increase in the exemption limit, and please do add more line items under exemption. And one more thing, please abolish the highway tolls. It is same as the 2nd class AC train fare, although with normal roads!”
“There are three things on the top of my mind:
Incentivising Digital First – To follow the Digital First agenda, one of the key moves expected from the government would be to reduce deterrents and incentivise enablers for expansion of the digital payment/lending ecosystem through:
a) Reduction in the 18% GST on banking services
b) Incentives for digital payment ecosystem providers (expansion of POS infrastructure beyond metros/Tier I, creation of inter-operable toll/transit payments), and
c) Possibly creating a digital payment/lending fund not only facilitating expansion but also providing for the additional risk of expanding the universe
Government should lead the way through
a) Complete removal of surcharges on digital payment modes through government portals (e.g. eNPS, IRCTC, PSU entities)
b) Mandating digital payments for government transactions
Enablers for expanded access to digital payments/lending through
a) Tax relief for adoption of digital payments by small businesses and/or in rural/semi-urban areas where people still avoid using digital payments
b) Making GST data accessible through secured APIs to fintech players to improve determination of creditworthiness of tax-paying businesses, which will expand access to an organised lending channel for this segment
c) Creating an enabling environment (through tax breaks/access to a Digital Payment Fund) for fintech entities who are helping to expand access to an organised/formal lending for under-served segments (like the low income group, the self-employed lot or people with little credit history) and possibly provide incentives/tax breaks to encourage first time consumers/recipients as well.”
“My main concern lies with taxes. I am expecting the tax burden on salaried individuals to be relaxed further. Also, the exemption limit under Section 80C needs to be increased. Basically, I am concerned about each and every one of us, the employees, to be able to make the best use of our earnings.”
“The first thing that comes to everyone’s mind is the minimum tax slab. This needs to be increased to Rs. 5 lakhs for everyone. Another thing that’s been on almost everyone’s wish list, even mine, is increasing the exemption limit under Section 80C. Rs. 1.5 lakhs is just not enough and all the popular investments come under this section. I’m sure there are many who will agree.
Tuition fees for children should come under a separate section and not Section 80C. With education costs spiralling, this might bring quite a bit of a relief. As for Education Loans, the principal repayment can be included under Section 80E. The most important thing is that efforts need to be taken for lowering healthcare costs. With medical inflation increasing at 10% a year, a major illness could possibly wipe out the lifetime savings of a family with a single earning member.
Is the government even listening?”
“We, the salaried class, are a compliant lot. More than half our income goes towards one tax or the other. But how little we get in return? Our civic systems are a mess, housing is prohibitively expensive, healthcare and education costs are alarmingly high, and there’s no social security once we retire. As disciplined taxpayers, we deserve better.
Increasing the tax base has been a pet project of the Modi government. So, I want to request the Finance Minister to incentivise paying taxes. I’ll even pay at a higher income tax slab if you can give something back to me. It could be in the form of healthcare and education reimbursements, or a guaranteed pension – all of which can be proportionate to the income tax I would pay through my life. These would be just rewards for a lifetime of compliance.”
So, what are your expectations? Let us know in the comments section below.