New Delhi: Union Budget 2025 is just days away, with Union Finance Minister preparing to present her eighth budget in Parliament.
There have been several proposals and suggestions for Sitharaman, and one of them is really interesting.
The Institute of Chartered Accountants of India (ICAI) has put forward a bold proposal, advocating a joint taxation system for married couples.
It’s a system followed in countries like the US and the UK, which treats married couples as a single taxable unit, and offers families the choice between filing taxes individually or jointly.
The key elements of the proposal are twofold — basic exemption to be doubled to Rs 6 lakh for joint filers compared to Rs 3 lakh for singles and revised tax slabs for couples, with surcharge threshold to be increased from Rs 50 lakh to Rs 1 crore, with surcharges of 10 per cent on Rs 1-2 crore, 15 per cent on Rs 2-4 crore, and 25 per cent above Rs 4 crore. Salaried couples will also benefit from the standard deduction.
Currently, dual-income households can claim individual deductions, while single-income families are at a disadvantage, hence there is a scope for reform as per ICAI.
Experts are of the opinion that joint taxation will reduce total tax liability for families, especially single-income households.
“This proposal is designed to assist families, especially where one spouse is the primary earner,” Times Now quoted chartered accountant Suresh Surana as saying.
Families can choose from the option of the default tax system or proposed regime depending on their financial structure.
However, SR Patnaik, partner and head of taxation at Cyril Amarchand Mangaldas, remarked that such a reform may not materialise immediately.
“Introducing joint taxation would require the creation of a completely new system with revised slabs, rates, and exemptions, which may delay its implementation,” he said.
We will have to wait till February 1 to know whether the proposed reform is brought in.
