How Will Budget 2019 Affect Common Man?

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Budget time is when the man in the street and business executives hold their breaths. Announcements can either fill them with joy or add another burden. Rich taxpayers are not at all pleased with this year’s budget that raised surcharge from 15% to 25% on income between Rs 2 crores and Rs 5 crores. However, that is not likely to make much of a dent in their deep pockets. It is the common man who will have to tighten purse strings and make do with less. What is the effect of budget 2019 for a common man? Some things have become expensive and that is to be expected. There are no fireworks or reason to burst crackers this budget.

Tax deductions on loan

The budget allows additional deduction of Rs 150000 on loan interest the provided loan is for residential house and provided it has a value less than Rs 45 lakhs. This deduction is in addition to the deduction of Rs 200000 available under section 24. Electric scooters see taxes reduced and if one buys an electric vehicle on loan then the person availing the loan is eligible for a deduction of Rs 150000 from taxable income under section 80EEB.


What has become cheaper

The budget 2019 for a common has a few things to make him happy. Some things are likely to become cheaper, provided of course, that the manufacturer passes on the benefits. Those who buy electric vehicles set top boxes and electronic goods will likely see a price reduction.


What has become expensive

It is not a budget 2019 for a common man when you consider that petrol/diesel has become expensive with a cess of Re. 1 per litre. After all, common buy electronic goods only once in a while but he must buy petrol every day. So it is like giving with the left hand and taking away with the right hand. Apart from petrol the other products to become expensive are air conditioners, cigarettes, automobile parts, gold, silver, cashew, tiles, newsprint and other items.


You can use either PAN or Aadhar to file tax returns

Does common man pay tax? Assuming he does then he will be able to use either PAN or Aadhar in filing tax return. Further, filing tax returns becomes easier due to data retrieves from various sources.


Tax rebate

There are sops for the common man in taxes. If your taxable income is Rs 500000 or lower then you get a tax rebate of Rs 12500. Standard deduction increases to Rs 50000 from the earlier Rs 40000. TDS limit in savings in banks and post offices sees an increase to Rs 40000. Gratuity limit is increased to Rs 2 lakhs.

The common man is certainly not going to be happy with price increase in diesel and petrol or with the increase in price of split air conditioners but the consolation is that it could have been much worse. The price increase, even if it is only Re. 1 on diesel/petrol is likely to have a cascading effect since it will affect transport sector that in turn will raise price of transportation and this will likely lead to all round price increases. You can know more about understanding budget, price increases and taxation through taxation course in Ahmedabad.
Location: Gujarat, India

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