Opinion
Mint Quick Edit | Tax cuts are in high demand
Summary
- A majority of individual taxpayers want finance minister Nirmala Sitharaman to ease taxes in the budget. It’s a worthy idea. But how long will a confusing dual-option system last?
As many as 57% of individual taxpayers want finance minister Nirmala Sitharaman to lower taxes in the budget, according to a sample-survey carried out by Grant Thornton Bharat.
Encouragingly for the government, 72% of those surveyed say they have shifted to the new tax regime, with lower rates but no document-based deductions, although 63% of individual taxpayers want stronger incentives under the old tax regime.
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This suggests that some may consider a switch-back. To make the new system more attractive, about 46% want lower tax rates, while 26% seek a higher basic exemption limit. Broadly, the survey’s findings reflect the discontent among taxpayers who have felt squeezed by successive governments.
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While the tax net has been widened, this section bears a disproportionately large burden of the government’s tax mop-up. Throw in woes like persistently high inflation and the neglect felt by India’s mid-slab earners is easy to grasp, especially since the poor are getting increasing handouts.
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While taxpayers need relief and consumer demand needs to be stoked, the government mustn’t run a dual option system for too long. That would defeat the whole idea of tax simplification.
