Finance Minister’s interim budget 2024 lays emphasis on stability, continuity in taxation

NEW DELHI: Union Finance Minister Nirmala Sitharaman’s Interim Budget for the fiscal year 2024, underlined the government’s commitment to stability in taxation and a strategic approach to encourage economic growth. The Finance Minister made no changes in the taxation structure in what can be seen as a relief to taxpayers.

“In keeping with convention, I do not propose to make any changes relating to taxation and propose to retain the same tax rates for direct and indirect taxes including import duties. However, certain tax benefits to startups and investments made by sovereign wealth or pension funds as also tax exemption on certain income of some IFSC units are expiring on March 31 2024; to provide continuity, I propose to extend the date to March 31, 2025”, the Finance Minister said.

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The commitment to maintaining the existing tax framework aligns with the government’s strategy to provide stability and predictability to businesses and taxpayers.

However, Nirmala Sitharaman acknowledged certain impending changes in tax benefits and exemptions. She addressed the expiration of tax benefits for startups and investments made by sovereign wealth or pension funds, along with the tax exemption on specific income of some International Financial Services Centre (IFSC) units.

To ensure continuity and provide a seamless transition, the Finance Minister proposed an extension of the expiration date to March 31, 2025. The decision to extend these tax benefits reflects the government’s dedication to fostering an environment conducive to entrepreneurship, investments, and the growth of IFSC units.

The move is expected to provide businesses and investors with a clear and extended timeframe to plan and adapt to the changing tax landscape. Sitharaman’s announcement comes against the backdrop of a budget aimed at promoting economic resilience and recovery. The extension of tax benefits aligns with the broader vision of ensuring policy continuity, providing businesses with the confidence and stability needed for sustained growth.

The Interim Budget for 2024 is expected to undergo detailed scrutiny in the coming days, with stakeholders analyzing the implications of the proposed tax measures on various sectors of the economy. The government’s emphasis on stability and the extension of key tax benefits indicate a cautious yet forward-looking approach to navigate the economic landscape in the upcoming fiscal year.

As discussions unfold, the Interim Budget is poised to play a pivotal role in shaping India’s economic trajectory for the year ahead. (ANI)