Budget 2024: Key Dates, Statistics, and Anticipated Reforms

Budget 2024: As Finance Minister Nirmala Sitharaman gears up to present the interim budget for 2024, anticipation and speculation are high regarding the potential changes and announcements.  This will be Sitharaman’s sixth consecutive budget since 2019, a noteworthy feat shared with a select few of her predecessors. With the budget coinciding with an election year, it is scheduled to bring about significant changes across various sectors.

Budget 2024: Taxation Reforms and Dates to Watch

One of the key areas of focus in Budget 2024 is taxation. The markets have long awaited the removal of the Security Transaction Tax (STT), especially since the increase in GST collection.

This anticipated move, aimed at attracting more investors to domestic equity markets, could be a significant highlight of the budget. Double taxation on dividends may be relieved, which is expected to please the markets. These reforms will be announced when Sitharaman presents the interim budget, laying the groundwork for the full fiscal year 2024–25 budget after the general elections.

Pension and Insurance: Enhancements Expected in Budget 2024

The Budget 2024 is also predicted to bring substantial changes to pension and insurance schemes. ICRA suggests that the government might consider raising the pension floor under the Atal Pension Yojana (APY) for unorganized sector workers. Additionally, making annuity income from the National Pension System (NPS) tax-free, especially for senior citizens, could be another significant step.

The current investment ceiling of Rs 50,000 may see an enhancement to Rs 1 lakh, while a separate tax deduction for life insurance premiums could improve insurance penetration in India.

Mutual Funds: Budget 2024 to Address Tax Discrepancies

In mutual funds, Budget 2024 may address the difference in tax treatment between equity mutual funds and unit-linked insurance plans (ULIPs). The government is expected to aim for a simplification of the capital gains structure, introducing a uniform holding period for domestic equities and mutual funds. The 2023 tax amendment to the Finance Bill, which impacted various mutual funds, might be revisited to ensure equitable treatment and higher compliance.

Markets and Green Initiatives: Key Focus in Budget 2024

Market reforms are set to be a major theme in Budget 2024, with a possible comprehensive policy on cryptocurrency regulation. The return of sovereign green bonds is highly anticipated, catering to the funding requirements for renewable energy sectors like wind and hydropower.

The budget is likely to allocate significant funds for energy transition and net-zero objectives, focusing on new-age fuels such as green hydrogen, ethanol, and other biofuels.

Conclusion:

In conclusion, a pivotal moment for India’s financial and economic sectors is expected to occur with the presentation of the interim budget for 2024 by Nirmala Sitharaman.

From key taxation reforms to enhancements in pension and insurance schemes, and from mutual fund regulations to market reforms and green initiatives, the budget is expected to set a transformative path. As we await the budget after the general elections, the interim budget is expected to set the tone for the country’s financial and economic policies for the coming year.

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