Another boost for new Tax regime in India

In the last few years, the amount of tax collected has increased drastically in India and the government is also trying to do a lot of regulations. The government is trying to standardize the taxation process so that there are not many loopholes and people can find it easier. I usually take care of my tax return submissions and while doing so I see different categories in which someone can get a tax exemption. In the last few years, we can see this new tax regime getting very popular. Many people have adopted to new tax regime and some companies also make it mandatory for someone who is just getting started.

People who are in the old tax regime still get their benefits but using the new tax regime has a lot of advantages where there is no big hassle to submit proofs and get exceptions in different categories. That's what makes this new tax scheme very attractive. For a basic exception, this is very good because people will not have to worry about collecting proofs and submitting them to authorities for verification. The new tax regime provides a standard deduction and calculated tax with a different slab. For anyone who is using the old tax regime and would like to switch to the new one, the difference is not too much. I have a few colleagues who have already switched to the new tax regime.

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During the year-end activity, people who are in the old tax regime will have to break their heads to consolidate all the bills and proofs they have but in the new tax regime people will have nothing to do and the tax would be deducted similar to the old but with a different slab that itself would compensate the benefit. Anyways after a point or after a particular salary, people cannot make too much of exceptions and they might end up paying a considerable amount of taxes. But if they opt new tax regime, there is no big difference in what they can save but the biggest advantage is that they don't have to submit any documents for investment proofs.

It is expected that the 2024 budget will have another boost for the new tax regime people in India. Already for the past few years, they have been getting better deals from the government. This year if they reduce the tax slab even further for them, it would be great because many people will move from the old tax regime to the new one because the final tax paid would still be something similar. We will know about this only later when the budget is announced.

I wish there was some reduction in the percentage for crypto income. 30 percent is the current value but maybe 10% or 20% would be more reasonable and many people would be willing to disclose what they are doing with crypto and pay their taxes accordingly. I don't think this can happen in this budget itself. Maybe it can take a few more years for the government to understand the potential of cryptocurrencies and blockchain technology.

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