Lok Sabha Passes Finance Bill 2024-25
Key Changes Announced by Finance Minister Nirmala Sitharaman
The Lok Sabha has passed the Finance Bill 2024-25, with Finance Minister Nirmala Sitharaman stating that the government aims to simplify tax laws and promote growth and employment in the country.
The Finance (No.2) Bill, 2024 was passed after a reply by Sitharaman, with the House rejecting the amendments moved by the opposition by a voice vote. Sitharaman highlighted Prime Minister Narendra Modi’s vision of a simple, efficient, and fair technology-driven taxation regime.
She emphasized that the primary objective over the last 10 years has been to simplify taxation, reduce the burden on taxpayers, and ensure transparency and equity. This year’s approach continues this trend, aiming for greater simplification of tax laws and procedures.
Sitharaman presented the Union Budget in Parliament on July 23, marking the first full budget of the NDA government led by PM Modi in their third term. The Lok Sabha discussed the Finance Bill after passing the Appropriation Bill for the central government’s expenditure for 2024-25 on Monday.
The minister noted that the BJP-led government has revised tax slabs in the new tax-filing regime and did not impose additional tax burdens during the Covid-19 pandemic. The government has increased the standard deduction for salaried employees from Rs 50,000 to Rs 75,000, providing effective relief of up to Rs 17,500.
In 2023, personal income tax slabs were significantly liberalized, reducing tax liability by Rs 37,500 for all taxpayers. The government has again revised slabs in the new regime, benefiting the middle class.
For lower and middle-income classes, the limit of exemption of capital gains on certain listed financial assets has been increased from Rs 1 lakh to Rs 1.25 lakh per year.
The Union Budget for 2024-25 sets the fiscal deficit target at 4.9% of GDP, with plans to reduce it below 4.5% by 2025-26. The capital expenditure outlay remains at Rs 11.11 lakh crore for 2024-25, as announced in the interim Budget ahead of the General elections.
Doubts Revealed
Lok Sabha -: Lok Sabha is one of the two houses of India’s Parliament. It is where elected representatives discuss and pass laws.
Finance Bill -: A Finance Bill is a proposal by the government detailing how it plans to collect and spend money for the upcoming year.
Nirmala Sitharaman -: Nirmala Sitharaman is the Finance Minister of India. She is responsible for managing the country’s finances, including the budget.
Union Budget -: The Union Budget is a detailed plan of the government’s income and expenses for a particular year. It is presented by the Finance Minister.
tax slabs -: Tax slabs are different levels of income that are taxed at different rates. Higher income usually means a higher tax rate.
standard deductions -: Standard deductions are fixed amounts that reduce the total income on which you have to pay tax. It helps in lowering the tax burden.
capital gains -: Capital gains are the profits you make from selling assets like property or stocks. These profits are usually taxed.
fiscal deficit -: Fiscal deficit is when the government’s spending is more than its income. It is usually expressed as a percentage of the country’s GDP.
GDP -: GDP stands for Gross Domestic Product. It is the total value of all goods and services produced in a country in a year.
capital expenditure -: Capital expenditure is the money the government spends on building infrastructure like roads, schools, and hospitals.
Rs 11.11 lakh crore -: Rs 11.11 lakh crore is a large amount of money. One lakh crore is equal to 1 trillion rupees, so this is 11.11 trillion rupees.
