Page 21 - NIS English Jul 16-31 2024

Decade of Tax Reforms

Transformation of the middle class

Rapid advancement
In 2013 national and international publications often
painted a grim picture, declaring the dreams of the middle
class shattered by tough economic conditions. But there
has been a change in 2023-24. Be it sports, startups,
space or technology, the middle class of the country
is seen standing at the forefront of every development
journey. In the last few years, the middle class of India
has progressed rapidly. Their income has increased, their
size has increased. In 2013-14, about 3.31 crore people
used to file income tax returns. In 2023-24, this number
has doubled and more than 8.09 crore people have filed
Compliance norms eased to income tax returns.
promote start-ups Rising salaries
According to media reports, a very interesting figure
n To promote growth and development in some
is that in the year 2011-12, if we add the total income
key industrial sectors impacting medium to small
of those who get salary from Rs 5.5 lakh to Rs 25 lakh
taxpayers, the Government has taken several
annually, then this figure was about 2.8 2 lakh crore. By
steps to encourage start-ups, cooperatives,
2021, it has increased to Rs 14.5 lakh crore. Meaning
MSMEs, etc.
it has increased 5 times. There are two clear reasons
n Eligible start-ups have been provided with several for this. The number of people getting salary from Rs
tax benefits which are being regularly updated in 5.5 lakh to Rs 25 lakh has also increased a lot and
collaboration with DPIIT (Ministry of Commerce). the salary of people in this bracket has also increased
significantly. These figures are only of salary based
n Start-ups have been provided with a hassle-free
income, if business, income from home property, income
tax environment. This includes simplification of the
from investment etc. are added to it, then the figure will
assessment process, exemption from angel tax
increase even more.
subject to certian conditions and formation of a
dedicated start-up cell.
Easing living conditions
n ‘Angel Investments’ in eligible start-ups have been Ease of living is one of the top priorities of the central
government. There are unforgettable memories of
provided tax benefits. Hence eligible start-ups can
problems people have to face in earlier times. No one can
secure funding from angel investors as per the
forget the kind of problems the people of the country had
existing provisions of law.
to face earlier. Whether it was paying electricity-water

A new section 54EE has been
inserted in the Income Tax
Act, 1961 to enable eligible
start-ups to exempt their
tax on long-term capital
gains, if such long-term
capital gains or a part
thereof is invested in a
notified fund.

New India Samachar July 16-31, 2024 19