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There Is Currently No Plan to Introduce a Sunset Clause for the Old Tax Regime: FM

Finance Minister Nirmala Sitharaman, who presented Budget 2024 in the Parliament on Tuesday, said that she cannot make a definitive decision on eliminating the old tax regime. Responding to criticism from the Opposition, she emphasized efforts being made to simplify taxation.

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Representational Image (File Photo)

By ETV Bharat English Team

Published : Jul 23, 2024, 8:38 PM IST

New Delhi : Finance Minister Nirmala Sitharaman responded to criticism from the Opposition, which accused the budget of favoring states governed by supporting parties. She argued that alliances with fewer than 230 seats lack the authority to question allocations, asserting that the Centre has ensured fair distribution of funds to all states. Regarding the Rs 60,000 crore projects announced for Bihar and the commitment to secure multilateral assistance for Bihar and Andhra Pradesh, she clarified that the budget includes a pledge of Rs 1.5 lakh crore in assistance for all states.

During a press conference outlining key aspects of Union Budget 2024, Finance Minister Nirmala Sitharaman emphasized efforts to simplify taxation. She explained, "Our aim was to streamline the tax system, including capital gains. Additionally, we have reduced the average taxation rate to 12.5%. This reduction across different asset classes aims to encourage increased investment in the market."

While addressing questions about whether the government plans to phase out the old tax regime and shift focus solely to the new tax regime, the Finance Minister stated that she cannot make a definitive decision on eliminating the old tax regime but emphasized the intention to simplify the tax structure. She clarified that there is no sunset clause for the old tax regime.

Regarding the reduction in customs duty on gold, the government mentioned that this move would stimulate employment in the jewelry sector and boost exports.

Sitharaman reaffirmed the government's commitment to expanding the tax base. "We have consistently emphasized the need to broaden the tax base, both in direct and indirect taxation," she added.

The Finance Minister also highlighted the increase in non-tax revenue, particularly from public sector undertakings (PSUs). "PSU dividends have seen improvement due to increased valuations and enhanced performance. Therefore, revenue mobilization is not solely reliant on taxes; there is also a rise in non-tax revenue mobilization," Sitharaman concluded.

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