Budget 2024 expectations: Income Tax relief, old pension scheme — what the salaried class wants from FM Sitharaman

As the Union Finance Ministry is gearing up to present the full Union Budget for the fiscal year 2025 in July, several stakeholders have urged Finance Minister Nirmala Sitharaman to provide tax relief for salaried employees.

The Union Budget 2024-25 is expected to be presented in Parliament on July 23 or 24.

Budget expectations

Salaried employees are hoping to see several favourable announcements, including an increase in income tax rebate, restoration of the old pension scheme (OPS) and formation of the 8th Pay Commission.

The last pay commission was formed in 2014 and its recommendations were implemented in January 2016.

They also want income tax slabs under the old tax regime to be adjusted or the tax exemption limit increased for the new tax regime.

To boost consumption, the government may provide some tax relief to those with income above ₹15 lakh annually and may also explore reducing the income tax rates for annual income of ₹10 lakh, according to a report by news agency Reuters.

In a pre-budget meeting on Monday, trade unions made some key demands to the finance minister.

The unions had asked the government to stop the privatisation drive of PSUs, scrap the new pension scheme, fill all the existing vacancies in the central government departments and PSUs, and stop the practice of contract and outsourcing.

“The ceiling limit for the income tax rebate for the salaried class on their salary and gratuity must be substantially raised. Government-sponsored social security fund for the unorganised workers and agricultural workers has to be set up to provide them with defined universal social security schemes including minimum pension of ₹9,000 per month and other medical, educational benefits,” the Central Trade Unions said in their memorandum.

“Over the decades, corporate tax rates have been slashed unjustly and at the same time increasing indirect tax burden on common people resulted in an utterly regressive tax structure. That must be corrected in the interests of fairness, equity and propriety. Even one per cent inheritance tax on the super- rich with the ceiling can fetch huge amount to the budget receipts,” it said.

Several industry leaders had also urged the government to focus more on infrastructure development to maintain high economic growth.