Direct tax demand up to Rs 25,000 and Rs 10,000 will be scrapped till a certain period
The Centre will not pursue taxpayers to recover old and disputed direct taxes up to Rs 25,000 till the financial year 2009-10, Finance Minister Nirmala Sitharaman said in her interim Budget 2024 speech today.
Direct taxes demand up to Rs 10,000 from the financial years 2010-11 to 2014-15 will also be withdrawn, she said.
"This will benefit about one crore taxpayers," Ms Sitharaman said.
"... There are a large number of petty, non-verified, non-reconciled or disputed direct tax demands, many of them dating as far back as 1962, which continue to remain on the books, causing anxiety to honest taxpayers and hindering refunds of subsequent years. I propose to withdraw such outstanding direct tax demands up Rs 25,000 pertaining to the period up to financial year 2009-10, and up to Rs 10,000 for financial years 2010-11 to 2014-15. This is expected to benefit about a crore taxpayers," Ms Sitharaman said.
She did not make changes to tax slabs in the interim Budget in keeping with convention.
"As for tax proposals, in keeping with the convention, I do not propose to make any changes relating to taxation and propose to retain the same tax rates for direct taxes and indirect taxes including import duties," she said.
"However, certain tax benefits to start-ups and investments made by sovereign wealth or pension funds as also tax exemption on certain income of some IFSC units are expiring on 31.03.2024. To provide continuity in taxation, I propose to extend the date to 31.03.2025," Ms Sitharaman said.