A study of the impact of new tax regime on tax-saving investment of salaried person in Amravati city (KEY IJP************230)

• Sumit Digambar Nemade,Prof V. A. Ingole

Abstract

Abstract - The Union Budget 2020-21 witnessed a revolutionary change in the income tax system in India which became effective from 1st April 2020. This regime offers lower tax rates and, unlike the earlier system, most deductions and exemptions are not available hereunder. Such a transformation could lead to wide changes in the lives of salaried individuals as far as the investment decision for tax saving becomes the essential core of financial planning strategies. This research study is among salaried persons in the city of Amravati and investigates the areas of awareness, preferences, and investment behavior concerning the new tax regime. It also studies whether such salaried persons make rational choices, comparing the old and new tax regimes, while also studying the effect of the change on their behavior concerning savings and investments. The finding of this study will give an insight into how salaried persons are adapting the tax reforms whether tax-saving investments are continued in the old traditional manner and how it overall may change financial planning. The study would then be useful for policymaking in identifying the extent to which the new tax regime succeeds in the simplification of taxation while being counter-balanced by economic growth and the security of individual financial aspects.