With the much anticipated Union Budget 2020-2021 to be presented by the Finance Minister Nirmala Sitharaman on 1 February 2020, all sectors across the economic spectrum are focussed on the annual financial statement.
The personal finance sector, in particular, have set high hopes ahead of the Union Budget on account of the faltering economy which has projected the tax collections to fall shart of over Rs.2 lakh crore from its target for the current financial year.
It is quite unlikely for the Finance Minister to propose any substantial reduction in the personal income tax rates in the current scenario.
Also Read: Startups Eagerly Wait for the Union Budget 2020-21
However, taxpayers across the personal finance sector are on the edge expecting exemptions on various allowances such as the leave travel allowance (LTA) and house rent allowance (HRA) among others.
Employees located in metropolitan cities are offered higher deductions for the house rent allowance when compared to the other cities. However, with other cities climbing the ladder over the last few decades with increased employment opportunities, these cities are expected to be included in the same category as that of the metropolitan cities.
For any clarifications/feedback on the topic, please contact the writer at viswanathan.v@cleartax.in
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