Nirmala Sitharaman Takes on Critics in Lok Sabha, Stands Firm on Tax Reforms

Finance Minister Nirmala Sitharaman, on Wednesday, August 7, while responding to the discussion on the Finance Bill, 2024, in the Lok Sabha, said the current amendments ensure there will be no additional tax burden with regard to LTCG (long-term capital gains) tax on real estate transactions. Sitharaman said the fresh amendment that was introduced in the Finance Bill to let taxpayers select either 12.5 percent LTCG rate without indexation or 20 percent rate with indexation for real estate purchased before July 23, 2024. 

"Without drastically increasing taxes, we have brought in a simplified taxation regime, eased compliance," the Finance Minister said. 

Sitharaman added that the effective tax on annual income of Rs 15 lakh was reduced to 10 percent in 2023 and further reduced this year as well under the new IT regime. 

Sitharaman is highlighting that Prime Minister Narendra Modi’s vision is to have a simple, efficient, and fair technology-driven taxation regime in this country. She added that simplification of the tax regime and ease of compliance for the taxpayer have been the primary objectives of the government for the last ten years. This year, under the Prime Minister’s third term, the focus on taxes has been to further simplify, lessen the burden on taxpayers, and ensure that they are fair and transparent, she added. 

The Finance Minister added that along with the approach to relax taxation, the government is also focusing on creating employment in the country. In the Budget, the government announced measures such as the Employment-Linked Incentive (ELI) Scheme to create 2 crore jobs. 

Sitharaman also added that till July 31, 2024, a record number of income tax returns were filed. Out of those, 58.57 percent came from first-time filers. 

One of the biggest takeaways of the government was the removal of angel tax for start-ups. Speaking about the same, Sitharaman said that this removal is a relief for start-ups.