Union Budget 2021: Reintroduce single tax slab structure, raise minimum taxable income to Rs 7.5 lakh
Divakar Vijayasarathy, Founder and Managing Partner, DVS Advisors LLP
The salaried class could be disappointed if it’s expecting a reduction in tax rates. In fact, it should brace itself for a COVID cess. However, relief in terms of spending- based deductions, more in line with the alternate mechanisms provided for LTA during the Atmanirbhar Bharat package to improve domestic demand, can be expected. The deductions, unlike the investments based in the past, could be more available on spending. An increase in health insurance deduction and COVID-related hospitalisation can be anticipated. Considering the moratorium provided for 6 months during the pandemic, there could be a retrospective amendment on deductions available on housing loan interest and principal repayment.