JOIN USCommon man's guide through the Union Budget 2021
Due to the Covid-19 pandemic, India's commoners suffered some of the hardest blows. The raging pandemic resulted in a huge smack on the businesses and the overall economy, putting an abrupt halt to almost every form of existence.
The general public witnessed the impact of a faltering economy -- loss of jobs, pay cuts for many and all those costs that came with adjusting to what people called the new normal. In the previous year, the government had tried to heal the wounds with moratoriums and other such concessions.
Ahead of the Union Budget, let us have a look at what the common man can expect from the upcoming Budget.
In broader terms, the government would look forward to replenishing the treasury to deal with the vaccination of nearly half a billion against the coronavirus. In addition, the Centre's strong push for local manufacturing may also increase import duty on commodities, thus, increasing its end cost.
Firstly, according to some reports, a Covid cess is around the corner. This is a form of tax for a specific period to raise capital to fund a purpose, in this case, as the name suggests, the fund may be used to run the vaccination process smoothly. But, since the cess can be applied to nearly everything, the burden now rests on the consumers as the cost of commodities increases.
According to experts, consumers have to shell out more cash for one more reason -- government's push for local manufacturing. While the Centre aims to boost local manufacturing, import duties may witness a substantial hike, increasing costs of electronics, furniture and electric vehicles.
As for income tax exemptions and deductions, the budget becomes more crucial due to the lockdown-induced layoffs and pay cuts. According to a report, a section of taxpayers want tax exemptions on two-wheelers and four-wheelers to boost the demand side of the economy. "Because the auto industry has a multiplier effect on the economy, such a measure could help revive demand to a degree," an IT professional told Economic Times. An increase in tax exemption limit, hike in 80C deductions, and an increase in standard deductions are some of the key areas where the common man may witness some cushioning.
Senior citizens are another group of people who have borne the brunt of lowered interest incomes. Currently, Rs 50,000 interest income is tax-free for senior citizens. Many of the senior citizens may wish for increase in the limit to increase the income for the elderly.
As for the job-seekers, individuals in urban areas would seek some shelter, like MGNREGA for rural employment which came to rescue in the aftermath of the lockdown for migrant workers, who were stranded overnight.
However, how many of these overhauls will be considered is something that remains a question until February 1 when Nirmala Sitharaman will introduce a budget like "never before."