Budget expectations: People hope for increased I-T exemption limit

Chennai: Most people are hoping that the Budget will give them a New Year gift of an increased I-T limit, allowing exemption up to Rs 5 lakh per annum, according to a national survey done by a premier Chennai-based finance and management institution.

The survey was carried across India on about 2,000 people across age groups, from different walks of lives and social strata. In all, 62.2 per cent of the respondents expect an increase in the tax exemption limit, of which 37.9 per cent  want it to be increased to Rs 5 lakh. Also 57 per cent of the respondents expect a standard percentage deduction of salary income towards tax payment.
 “With huge cash making its way to banks, a majority of the people expects the benefits of the huge cash inflows from demonetisation to reach them,” said S. Sundar Raman, a chartered accountant of the Gurukripa Institute of Finance and Management, which carried out the survey.

“With the hike in industrial tax rate due to goods and services tax, an increase in service tax from the current 15 per cent to 18 per cent can be expected,” he continued.

A majority of respondents (59.7 per cent) also expects the limit for deduction of interest on housing loans should be increased of which 25 per cent feel it should be increased to Rs 3 lakh, while another 21per cent feel that no change in the current limit is required.

He added that the impact of rolling out GST would be evident on the budget, and most respondents would have appreciated a better time gap for implementation of the GST laws.

Also, with the focus shifting to digitisation, respondents, especially from the business classes, said that there should be incentives on embracing digitisation for doing their transactions.

Better implementation of laws should take place, Sundar Raman added, saying that it is difficult currently for small businesses to get loans even though micro, small and medium enterprises (MSMEs) are entitled to loans till '2 crore without any collateral, banks refuse the same.

“Even in the case of start-ups, it is the same. There should be a concessional rate of tax for startups to enhance their funding,” he added. Most people who took the survey responded that focus of the budget should be on reforms in the education sector, followed by the agricultural and industrial areas.