The Union Budget of India is presented in front of the Parliament before the beginning of every financial year. The financial year begins on the 1st of April and continues till the 31st of March of the following year. Divided into the capital and revenue budgets, it contains projected information about the annual receivables and payables of the coming year.
The Union Budget aims to bring quick and sustainable growth to the country’s economy. The budget changes impact try to ensure that resources are allocated efficiently to different departments, income disparities are lessened, unemployment and poverty levels are reduced, prices are kept in check, and a feasible tax structure is in place. It ensures that the country grows financially and that the funds are appropriately distributed to projects nationwide for progress and development in all fields.
The budget changes impact the lives of salaried people drastically. Various sectors of an ordinary person’s life depend on the budget—the taxes on entertainment, groceries, daily commodities, etc. The budget changes impact plays an essential role in planning expenditures and savings in the life of salaried people. Government plans about healthcare, transportation, technology, and other government services also impact the lives of salaried people.
This year as well, our honorable Union finance minister Nirmala Sitharaman presented the budget for FY-2023 on the 1st of February, 2023.
In this article, we will read about how this year’s budget changes impact salaried people’s daily lives.
Budget changes impact that is likely to affect the lives of salaried people
Tax slabs have changed under the new tax regime
Under the new budget changes impact, many tax-related changes have been made. The new tax regime lesser tax rates to those who don’t avail of exemptions or deductions. The exemption limit with no tax liability has been increased to ₹3 lakhs. Under the new budget, the new tax regime proposes reducing the maximum surcharge rate from 37% to 25%. The number of slabs has also been reduced from 6 to 5. The new tax regime has brought some much-wanted relief for the salaried people.
Increase in the income tax rebate limit
The excess money paid more than their tax liability is refunded to the individual in the form of a tax rebate. The tax rebate limit has also been increased in the new tax regime. From ₹5 lakhs, the income tax rebate limit has been increased to ₹7 lakhs.
Reduction in surcharge rate
The surcharge is the extra charge, fee, or tax added to the initially quoted price. The surcharge rate is not included in the stated price. Under the new budget, the surcharge rate has been reduced from 37% to 25%. The change in surcharge rates brings the maximum tax rate with the surcharge to 39%. This step will reduce the costs of multiple goods and services in all spheres.
New default tax regimes but the option to avail benefits of the predecessor
The new union budget allows salaried people to switch between the two tax regimes. In her union budget speech, honorable Finance Minister Ms. Nirmala Sitharaman said that while the new tax regime of 2023-24 is the default tax regime, the option of availing benefits of the old tax regime is still available. The switching can be done multiple times with no limit.
Announcement of new investment schemes for women
In the union budget 2023, new investment schemes for women were introduced. A one-time small saving scheme for women was presented with the name Mahila Samman Saving Certificate that will be available. It offers a fixed interest rate of 7.5 percent for its tenure of 2 years. The scheme will be open to avail till March 2025. The plans will also offer a partial withdrawal facility.
Reduction in the average processing time of ITR
During the Union Budget 2023-34 presentation, the government stated that the ITR’s average processing time would be reduced from 93 days to 16 days in the next-gen ITR reforms. It also aims to roll out modified ITR forms and strengthen the grievance redressal mechanisms for the convenience of the taxpayers. Finance Minister Ms. Nirmala Sitharaman also made many announcements about direct tax proposals to maintain the stability and continuity of taxation and simplify and rationalize various provisions.
Price fluctuation of products
Like every year, this year’s budget stated increases in the prices of some products, while others got cheaper due to fluctuations in their primary customs duties. Mobile phone parts, chargers, automobiles, lithium-ion batteries, the EV industry’s raw materials, etc., will now be available at lower prices. On the other hand, kitchen appliances, cigarettes, imported rubber, gold articles, jewelry, etc., will become costlier.
Announcement for PM Kaushal Vikas Yojana 4.0
The announcement for the launch of Pradhan Mantri Kaushal Vikas Yojana 4.0 was made with the report of the union budget. The Yojana aims to skill the youth of India within the next three years. The scheme will emphasize on-job training, partnership with industries, and alignment of courses with industrial needs. It will also focus on new-age classes like robotics, coding, mechanics, etc.
Establishment of new nursing colleges
With the advent of the new budget in 2023, the government announced setting up 157 nursing colleges to promote medical research, development, and inclusive development. These nursing colleges will share their location with government-established hospitals since 2014. This new development has been allotted under the budget of the Ministry of Health and Family Welfare.
Launch of Pradhan Mantri Primitive Vulnerable Tribal Groups Development Mission
The government will launch the Pradhan Mantri Primitive Vulnerable Tribal Group program to develop and uplift the tribal groups. This project spanned over the next three years and has a budget of ₹15,000 crores. This mission will adequately provide the primitive vulnerable tribes with habitations and basic facilities like clean water, sanitation, healthcare, education, connectivity, employment, etc. This scheme projects to help 3.5 lakh tribals.
After reading this article, we can conclude that even though the budget changes impact the life of every person in the country, it significantly impacts the lives of salaried people. The budget changes impact for the financial year 2023 focused on reaching the last mile, inclusive development, infrastructure and investment, green growth, youth power, and the financial sector. New tax regimes, changes in tax slabs, new provisions, investment schemes, etc., impact the financial planning of every salaried person.
Fluctuations in prices of daily commodities, luxuries like cars and properties, entertainment, etc., are some factors that a salaried person has to keep in mind from every budget, and this year was no different.
The budget changes impact aims to obtain rapid and lasting financial growth. This objective of a better economy is facilitated by paying taxes, reducing economic disparities, increasing participation by the youth, and keeping sustainable ideas in mind. As citizens of India, it is our responsibility to boost the financial growth of our nation as much as possible by paying taxes regularly, judiciously using public resources, and encouraging indigenous businesses and products.
We hope this article clarifies your doubts and provides you with information about the impacts of budget that are likely to affect the lives of salaried people.