Fri Jan 31 23:58:18 UTC 2025: ## Budget 2025: Taxpayers Hope for Relief as Sitharaman Prepares Eighth Budget

**New Delhi, [Date of Publication]** – As Finance Minister Nirmala Sitharaman prepares to unveil her eighth Union Budget on February 1, 2025, individual taxpayers are eagerly anticipating significant tax reforms. Experts predict the budget will focus on boosting disposable income and stimulating economic growth.

Key expectations include raising the basic exemption limit under the Concessional Tax Regime (CTR) from ₹3 lakh to ₹5 lakh. Further, rationalization of tax rates under the old tax regime is also anticipated. Taxpayers are also hoping for an increase in the tax deduction cap on home loan interest payments under the old regime from the current ₹2 lakh.

A significant concern for taxpayers in rapidly expanding cities like Bengaluru, Hyderabad, Gurgaon, and Pune is the classification of these cities for House Rent Allowance (HRA) exemptions. Experts are advocating for classifying them as metropolitan cities, thus allowing higher HRA exemptions.

The burgeoning Electric Vehicle (EV) market presents another area needing clarification. Currently, there’s ambiguity on the perquisite value calculation for company-provided EVs used for both personal and official purposes. The budget is expected to address this issue.

Other anticipated reliefs include deferring the taxability of interest on provident fund (PF) contributions and extending the tax deferral benefit on Employee Stock Option Plans (ESOPs) to all companies, not just eligible startups.

According to Rama Karmakar, tax partner at EY India, and Alfred S. Rodrigues, Director – Tax, EY India, these changes would not only simplify tax processes but also leave more money in the hands of taxpayers, potentially boosting consumer spending and overall economic growth. The views expressed are personal.

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