In this escalating environment of rising inflation ahead of Union Budget 2025, loan EMI escalates, and education expenses shoot through the roof, India’s middle class is trapped in a financial noose. Former Infosys CFO TV Mohandas Pai has voiced serious concerns about the mounting economic burden, urging the government to prioritize tax relief in the Union Budget 2025.
At a recent interview, Pai talked about the rising frustration of middle-class families, e.g. The middle class is agitated and frustrated by high taxation and low wellbeing. Income got trapped, but EMIs and education fees have shot through the roof, “he said.
The Financial Struggles of India’s Middle Class
Various reasons cause financial strain/pressure on the middle class. EMI of housing loans has gone up substantially and more than 1.2 crore people are holding home loans and more than 1.5 crore people holding other types of loans. In the meantime, education costs have increased by 40-60% over the past 3 years, so families are struggling to pay good tuition for the schooling of their children.
Parents have to contribute this growing scholarship and college tuition from their post-tax incomes, meaning they are facing financial losses”, Pai argued. However, with limited disposable income to spend, middle-class families are seeking relief from over-taxation and economic strain.
Call for Simplified Taxation and Relief Measures
Pai strongly criticized the current tax structure, calling it unnecessarily complex. “We have gone from three tax slabs to seven, making the system more confusing. The government has to change the way it looks at its business and lower the tax burden,” he insisted.
Taking a dig at India’s taxation policies, Pai mocked the controversial “popcorn tax,” highlighting how different types of popcorn are taxed at varying rates. Rather than simplifying taxation, the government is mired in petty issues. At the same time, real-world problems such as medical insurance GST and middle-class relief are sidelined.
Demands for Union Budget 2025 to Help India’s Middle Class
For the upcoming Budget 2025, Pai has been demanding:
- Income tax reforms: Simplify slabs and reduce tax rates.
- Lower GST on essential services Particularly on medical insurance.
- EMI relief: Addressing the rising cost of borrowing
- Education affordability: Government intervention to regulate fee hikes
The middle class, long regarded as the engine of India’s economics, is now crying for reform. Once fiscal minister Nirmala Sitharaman of the Union government’s table, everyone will be looking at whether the urgent issues are given any attention.
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