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People Group and Shaadi.com founder Anupam Mittal praised the Union Budget's provision to not tax salaried individuals earning up to Rs 12.75 lakh, calling it a "systemic correction".
The Shark Tank India investor said previous Budgets reduced middle class professionals to a "punching bag", where individuals were "taxed at every turn, squeezed for every rupee, while the ultra-rich found loopholes and businesses got tax breaks".
In her Union Budget speech on Saturday, Finance Minister Nirmala Sitharaman said no income tax payable up to Rs 12 lakh, i.e., up to Rs 12.75 lakh including standard deductions - under the new regime. Ms Sitharaman said this will "substantially reduce tax burden on middle class and leave more money in their hands". It will also boost household consumption, savings, and investment, she said.
Echoing the Union minister's statement, Mr Mittal said history is witness that thriving middle classes, not over-burdened ones, build strong economies. "You don't build an economy by making people feel gareeb (poor). You build it by making them wealthier," he wrote.
He cited examples of the US's bet on its working class after World War II leading to a boom in manufacturing and consumer spending, and higher incomes and rapid economic expansion resulting from China's focus on the middle class in the 2000s.
"For years, we (India) got it backwards. Instead of fueling spending and investment, we kept squeezing our most productive taxpayers-the salaried class. This Budget shifts that," Mr Mittal wrote in a LinkedIn post. He said that more disposable income would lead to increased consumption, which will eventually spur economic growth.
In other tax-related announcements, Ms Sitharaman also said TDS, or tax deduction at source, rates will be rationalised, and the limit for tax deduction for senior citizens will be doubled to Rs 1 lakh.
Further, she also proposed doubling the deadline to file updated returns to four years.