Finance Minister Nirmala Sitharaman is reportedly mulling significant relief for India's lower-income earners with tax cuts for the first time in seven years. The tax cuts are believed to be part of a consumption-boosting package worth nearly $6 billion in the upcoming Budget, a Bloomberg report has claimed.
The move will reportedly benefit individuals earning between Rs 5 lakh to Rs 15 lakh, who currently face tax rates of 5%-20%. The report further said the Centre may go for a new tax bracket.
Details, however, are still under discussion, and a final decision will be made closer to the Budget announcement, expected on July 18. Despite potential revenue losses from these tax changes, the government is committed to maintaining its fiscal deficit target of 5.1% of GDP for the current financial year, the report added.
Discussions include raising the annual cash payment to small farmers from Rs 6,000 to Rs 8,000, increasing payments under the minimum job guarantee program, and expanding financial support for women farmers.
Finance Minister Nirmala Sitharaman is conducting pre-budget consultations with stakeholders, including economists, trade unions, and industry chambers. Local media suggests that the budget announcement could be on July 22.
Industry associations such as CII in pre Budget discussions with the Revenue Secretary have suggested providing