Mohandas Pai Urges Tax Relief for Middle Class in Budget 2025
Noted businessman and ex-CFO Infosys Mohandas Pai has requested Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman to focus more on middle-class taxpayers in Budget 2025-26. According to him, growing financial pressure from this group of people needs special attention. The businessman also felt that taxes have increased sharply in the recent past, with added costs for living and education being a massive headache for NDA supporters.
Pai's appeal follows government reports that net direct tax collections for the current fiscal have grown a robust 15.88%, standing at Rs 16.90 lakh crore. Gross direct tax revenues in April 2024 to January 2025 grew by 20% to reach Rs 20.64 lakh crore. Corporate taxes comprised Rs 7.68 lakh crore; personal income tax revenues Rs 8.74 lakh crore. The period also witnessed refunds to the tune of Rs 3.74 lakh crore, up by 42.49% compared to the last year.
In a sharp upswing in the individual tax collection, Pai also said that gross revenues have jumped from Rs 4.87 lakh crore in the year 2020-21 to Rs 10.45 lakh crore in the year 2023-24, which registered a growth of 114% in three years. He expects individual tax collection for the next year 2024-25 to be Rs 12.5 lakh crore, with 22% growth in gross collections.
To lighten the burden of taxpayers, Pai suggested the restructuring of income tax slabs. He recommended no tax for incomes up to Rs 5 lakh, 10% for Rs 5 lakh to Rs 10 lakh, 20% for Rs 10 lakh to Rs 20 lakh, and a maximum of 30% for above Rs 20 lakh. For the elderly, Pai suggested raising the tax-free threshold to Rs 7.5 lakh for those above 60 years and removing taxes on incomes up to Rs 10 lakh for those above 70 years.
Pai also suggested that most deductions be removed except Sections 80D (medical insurance) and 80G (donations). This optional scheme, he said, would make the tax structure more transparent and manageable for taxpayers.
Pai’s recommendations come amid rising inflation and increased living costs, prompting demands for immediate government action. As the government prepares to unveil Budget 2025-26, the middle class eagerly awaits potential relief measures that could address their growing financial challenges.
