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Delhiites hail tax relief up to 12-L income

Feb 02, 2025 07:34 AM IST

Some people said the tax break will likely have an impact on the assembly elections scheduled in four days.

New Delhi: The Union budget presented on Saturday and its most talked-about takeaway, a big tax break for the middle class, brought cheer to a wide swathe of Delhiites and triggered the possibility that the big-bang announcement could move the needle in the upcoming assembly elections in the Capital in favour of the Bharatiya Janata Party (BJP).

Some people said the tax break will likely have an impact on the assembly elections scheduled in four days. (PTI)
Some people said the tax break will likely have an impact on the assembly elections scheduled in four days. (PTI)

From teachers and IT professionals to bank employees and doctors – a huge chunk of Delhi’s middle-class hailed the budget’s announcement that no tax will be levied on income up to 12 lakh under the new tax regime.

“The ‘ache din’ of the middle-class begins now. The salaried class stands to benefit the most from this budget. They will spend this money on small luxuries – holidays, shopping, eating out – and that’s good for the economy,” said Manoj Varshney, who runs a travel agency in Delhi.

Importantly, some citizens said the tax break will likely have an impact on the assembly elections scheduled in four days.

“The BJP’s core voters are the middle-class, and a lot of them are Gen Z and millennial, who I believe will show up in big numbers to vote after this move. It benefits them and instills faith in the party. It tells them that they matter to the BJP. There may not be a big shift in loyalty among voters, but the turnout should be better,” said Varshney.

The tax rebate assumes extra significance for a city such as Delhi which has one of the highest share of taxpayers in its population, according to income tax data. Delhi also has the highest proportion of salaried workers in the country, according to the Periodic Labour Force Survey (PLFS). Hence, the tax sops will likely consolidate the middle class behind the Bharatiya Janata Party (BJP), the traditional party of choice for these sections, and arrest the slide in the support of the demographic.

BS Vohra, president of the East Delhi RWAs Joint Front, said that after a long time, it felt like the government was working for the middle-class. “The tax rebate has an impact on entire families. Even those who earn more than 12 lakh a year have a person in their family who stands to save money. This is additional income in fact,” he said.

The tax announcement also changed the flavour of the Delhi elections, which has till now been dominated by competitive welfare sops and freebies announced by all three major contenders. In the February 5 polls, the Aam Aadmi Party is hoping for a third full term while the BJP is aiming to ride on anti-incumbency and its own bouquet of welfare promises to displace Arvind Kejriwal’s outfit. The Congress is hoping to improve on its dismal showing in the last two assembly polls.

Praffulit Bisht, a 30-year-old assistant professor at Miranda House, said that the announcement could reverse the perception that the Centre was not paying attention to the middle class. “This decision can have some impact on the upcoming elections,” he said.

Ashwini Marwah, general secretary of the Lajpat Nagar Traders’ association, said that the Delhi election continues to be fought on freebies and welfare schemes that the middle-class didn’t benefit from. “This middle-class friendly budget benefits the middle-class across India, not just in Delhi. The voter understands this and is unlikely to shift their vote to another party,” said Marwah.

Alka Kapoor, a 56-year-old school principal of Modern Public School in Shalimar Bagh, concurred with Marwah but added that it’s the right move at the right time. “The middle class has been neglected for too long. When any government reduces the burden on us, it benefits many people. It has a good impact on every member of my family,” she said.

Delhi BJP chief Virendra Sachdeva hailed the budget and said it will help his party that is attempting to win the Capital after 27 years. “By increasing the income tax relief limit to 12 lakh, the Modi government has given new wings to the aspirations of not only young professionals working in multinational companies but also the entire middle class,” he said.

A senior BJP leader, who asked not to be named, said, “The party already has a strong presence among the urban middle-class, traders, and middle to high income groups. The announcement of the eighth pay commission as well as these budget benefits will help us further consolidate this section.”

The Aam Aadmi Party, which had earlier demanded a rebate till 10 lakh, said the government didn’t go far enough.AAP leader Sanjay Singh said, “...They have announced relief for the salaried class earning up to 12 lakh, but what about small and medium business owners? How will they get any relief?”

Sajjan Kumar Singh, political analyst at Policy Research and Center for Contemporary India Study (PRACCIS), said that there was a clear class divide in the voting pattern in Delhi and this middle-class-friendly budget will only increase their consolidation towards the BJP.

“The middle-class is anyway a BJP voter, and the budget announcements will likely increase the BJP’s vote share, but this is a comparatively smaller section of voters in Delhi. A majority is from the lower middle class and poorer sections,” he said. He added that while the announcement could help the BJP increase its vote and seat-share, an outright majority could still be difficult.

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