What common man expects from the Budget 2019?

What common man expects from the Budget 2019?

Last Updated: Jun 27, 2019 - 03:30 am 133.3k Views
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From the days of the “Common Man” famously caricatured by the inimitable R.K. Lakshman, every budget has tried to build its central theme around the Aam Aadmi. Over the last few years, the Aam Aadmi has also become a lot more conscious of their rights and has

  1. In India, the joys of a common man begin with low inflation. That would encompass keeping food prices and fuel prices low. The government will have a tough job in hand with higher MSP committed to farmers. Either the budget can look at subsidizing prices or through helicopter money. Low inflation will remain a key expectation.

  2. The second demand on indirect taxes is, in a way, related to the first item. In the past, the government would use the budget to tweak indirect taxes like excise and customs. With most taxes subsumed into GST, the GST Council takes care of most of the rates. However, the customs duty has been regularly hiked increasing the burden on the common man. That can be avoided.

  3. The demand to cut personal taxes never really ceases. In the interim budget 2019, net taxable income up to Rs.5 lakhs was made tax free. However, this was given as a rebate. It would be preferable to have a blanket exemption limit of Rs5 lakh as it will substantially reduce the burden of those who are slightly in the higher bracket.

  4. The time is really ripe to enhance Section 80C exemption limits. The limit has stood at Rs.1.50 lakhs for a long time. Most savers end up mandatorily saving much more but don’t get any tax benefit. To make Section 80C more realistic, the budget can make a start by raising the limit to Rs.3 lakhs. Also, the limit for home loans at Rs.2 lakhs needs to be enhanced to at least Rs.4 lakhs to reflect the current property market.

  5. The budget should seriously consider an enhanced standard deduction limit or reintroduce scrapped allowances. When standard deduction was introduced at Rs.40,000 in 2018, the medical allowance and transport allowance were scrapped. Either the budget needs to reintroduce these allowances or enhance the standard deduction limit to Rs.75,000 to make it more meaningful.

  6. Blanket exemption for routine medical expenses is one more demand of the Aam Aadmi. Today routine medical expenses have shot up. A visit to a doctor can set you back by Rs.2000 if you add up the consultation fees, tests and medicines. These are not covered by medical insurance. In the light of the rising costs, the budget can prescribe a limit for exemption for medical expenses against actual bills. This limit can be higher for senior and super senior citizens.

  7. It is time to extend Section 80TTA to all interest payments. Currently, interest on FDs and private FDs, and other bond are not eligible for the benefit of Section 80TTA. Firstly, it is expected that the budget will enhance the exemption limit to Rs.50,000 (without TDS) for all depositors. Secondly, other debt investments may also be included.

  8. Simplify leave travel concession (LTC) benefits rather than sticking to the old model. Currently, LTC is exempt once in a block of two years with the blocks being defined by the Income Tax Act. This unnecessarily complicates the issue. Instead, the budget can make LTC tax exempt against actuals every year and scrap the block system altogether.

  9. Finally, the common man would prefer simplicity on the tax filing front. Raise the limit for mandatory filing of tax returns from Rs.2.50 lakhs to Rs.5 lakhs. This will be a big relief for the people and also less of a burden on the tax department. The government can mandate that for all persons having income up to Rs.5 lakh, the Form 16 or Form 26AS can be used in lieu of returns. This will surely make life easier for the Aam Aadmi.

The demands of common man are intended more towards making life simpler and the cost of living lower. The budget is expected to work towards this target!

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