One crore tax payers get relief in Interim Budget 2024

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In the interim budget, there has been no relief in the income tax rates. The tax slabs have been kept unchanged. However, Finance Minister Nirmala Sitharaman has announced relief from pending tax demands. The government hopes that this step will bring relief to 1 crore taxpayers, considering it as the biggest highlight of the budget.

In the interim budget, Finance Minister Nirmala Sitharaman provided relief to taxpayers who had pending tax dues. She stated that those with tax dues up to Rs. 25,000 until the financial year 2009-10 will no longer have pending demands. Similarly, for the financial years 2010-11 to 2014-15, relief has been granted for pending direct tax dues up to Rs. 10,000. The Finance Minister claims that this step will benefit 1 crore taxpayers.

Sitharaman explained that there are numerous small, unverified, or disputed tax demands affecting a large number of taxpayers. Many of these tax dues date back to before 1962. As a result, honest taxpayers are facing difficulties, and their refunds are delayed.

The cost of tax recovery is believed to be a reason behind this step. The government is considering the cost involved in tax recovery. Recovering pending taxes incurs significant expenses for the Income Tax Department. In many cases, the government has to spend heavily to recover small or disputed tax dues. Sitharaman’s claim is that this decision will benefit both honest taxpayers and the government.

The increase in tax collection and the reduction in the time taken for processing returns were also highlighted during the budget speech. The Finance Minister mentioned that in the past 10 years, direct tax collection has more than doubled. The average time taken for processing returns during the financial year 2013-14 was 93 days, which has now been reduced to 10 days. The monthly collection from Goods and Services Tax (GST) has increased, reaching Rs. 1.66 lakh crores in 2023-24.