Finance Minister Nirmala Sitharaman on August 7 said that there has been “substantial tax relief” for middle class in last two years.

Replying in Lok Sabha, Sitharaman begins her address by listing out all the measures that have been taken by the government for the middle class. “In the last two years, substantial relief has been given to the middle class.”

Sitharaman also said that there will be a comprehensive review of the rate structure of indirect taxes in the next 6 months.

She added that the proposals in the tax segment in her Budget 2024 speech are based on the approach to bring in greater simplification of tax laws and are technology-driven.

Lauding Prime Minister's efforts during Covid breakout, the finance minster added, “PM Modi’s direction to me was in total contrast to what was happening in developed countries- no tax on citizens to meet Covid expenditure.”

She also said that the country has moved away from the days of tax terrorism. Faceless Appeal Scheme, Vivaad Se Vishwas brought relief to a large number of tax payers.

On angel tax removal mentioned in her Budget speech, Sitharaman added that the move has come as a big relief for startups. Angel tax was brought in 2012, the UPA government did not remove the tax, she noted.

Further, the finance minister also highlighted that exemption increase in LTCG to Rs 1.25 lakh was aimed at relief to middle class who have small investing capacity.

In the customs side, Sitharaman said, “We have taken several steps to boost domestic production and enhance export competitiveness. Custom duty reductions are aimed at lowering the cost of raw materials; we have brought rate cut in custom duties on several inputs for leather, textile to boost employment and bring down costs.”

She also clarified on custom duty cuts in marine products. She said, “Till the time domestic manufacturing in marine products sector reaches a certain level, the sector should not suffer, so the government went for custom duty cuts.”

Sitharaman on Income Tax returns:

In her Lok Sabha reply, Sitharaman added that record 7.28 crore income tax returns were filed in 2024-25, which is 7.5% higher as compared to 6.77 crore last fiscal, till July 31.

She informed that income tax refunds in 2023-24 are processed now in 10 days as compared to 93 days in 2013-14.

58.57 lakh were first time filers in income tax returns in 2024-25 indicating widening of tax base, Sitharaman added.

The new tax regime is simpler and gives more flexibility to the tax payer. The old regime is still not dissolved, she reiterated, adding that till July 31 in 2024-25 AY, 72.8% i.e. 5.2 crore taxpayers have moved to the new tax regime. The total number of taxpayers is at 7.22 crore.

On mutual fund investors, Sitharaman said that there are 4 crore mutual fund investors so far.

Source: Money Control