The Centre is considering a 30-35 per cent increase in the standard deduction limit for salaried taxpayers and pensioners in the upcoming federal budget, officials told The Economic Times.
The Centre is also likely to continue with current income tax slabs given the limited fiscal headroom, the publication reported citing officials.
"There are many suggestions on personal taxation. This year one common demand was to enhance the limit of standard deduction, especially considering inflated cost of medical expenses on account of Covid-19," a senior official from the finance ministry told the publication.
The official said the proposal is to increase it by 30-35 per cent and the plan is subject to final approval.
DH could not independently verify the report.
The standard deduction is not available for those who go for the new tax regime.
The standard deduction limit, currently at Rs 50,000, provides tax reliefs to salaried workers and pensioners in their taxable income.
Industry bodies told the publication that an increase in the limit is welcomed in light of rising medical and other expenses during the Covid-19 pandemic.
Trade bodies like Assocham and Confederation of Indian Industries (CII) had reportedly asked for a higher standard deduction.
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Published 11 January 2022, 09:54 IST