Budget 2025 income tax expectations: Finance Minister Nirmala Sitharaman will present the Union Budget 2025 on February 1, 2025. In its pre-Budget 2025 memorandum, Assocham called for rationalizing the surcharge on salaried individuals.
As per the existing provisions the applicable surcharge rates on salaried individuals are as follows:
| Income Slab | Rate of Surcharge |
| Income more than Rs 50 lakh but not exceeding Rs 1 crore | 10% |
| Income more than Rs 1 crore but not exceeding Rs 2 crore | 15% |
| Income more than Rs 2 crore but not exceeding Rs 5 crore | 25% |
| Income more than Rs 5 crore | 37% |
In order to bring parity between the classification of small assessee(s) being professionals vis-à-vis salaried individuals, Assocham says that FM Nirmala Sitharaman in her Budget should consider increasing the threshold for surcharge by 50% as below.
| Income Slab | Rate of Surcharge |
| Income more than Rs 75 lakh but not exceeding Rs 1.5 crore | 10% |
| Income more than Rs 1.5 crore but not exceeding Rs 3 crore | 15% |
| Income more than Rs 3 crore but not exceeding Rs 5 crore | 25% |
| Income more than Rs 5 crore | 37% |
To protect the interest of the revenue, the maximum slab may continue to be kept at Rs 5 crore.
“Vide Finance Act 2023, a proviso was inserted under section 44ADA(1) [i.e., presumptive taxation for individual or partnership firm (other than LLP) engaged in profession, under which the eligibility limit for opting presumptive taxation was increased for gross receipts from profession from Rs 50 lakh to Rs 75 lakh – in those cases where the aggregate amount received in cash does not exceed 5% of total gross receipts,” Assocham says.
This implies that, to ease compliance, the tax department treats professionals with receipts of Rs 75 lakh or less (non-cash receipts) as small taxpayers. To promote the digital economy, the department increased the threshold of presumptive taxation by 50% (from Rs 50 lakh to Rs 75 lakh).
However, from a surcharge levy perspective, the threshold begins at Rs 50 lakh.
