On Thursday, when Aam Aadmi Party (AAP) MP Raghav Chadha expressed his criticism of the Union Budget 2024-25, Finance Minister Nirmala Sitharaman countered him and dismissed his claim that the middle class is excessively taxed. While responding to Raghav, in the Rajya Sabha, Sitharaman clarified how marginal relief significantly reduces the tax liability for individuals earning slightly above Rs 12 lakh per year.
FM Sitharaman Calls Chadha’s Tax Statement to be “Misleading”
She not only rejected Chadha’s claim that those earning beyond Rs 12 lakh are taxed on every additional rupee without relief, the finance minister also explained the impact of marginal relief. Sitharaman said,
ADVERTISEMENT
“Raghav Chadha shouldn’t mislead the House by saying that a person will have to pay income tax on every rupee beyond Rs 12 lakh. That is incorrect”
She also summarized how taxpayers benefit under the marginal relief provision introduced in the budget
For example, if a taxpayer earns Rs 12.1 lakh, the tax liability without marginal relief would have been Rs 61,500. But, with marginal relief applied, the actual tax payable is just Rs 10,000. Likewise, for an income of Rs 12.5 lakh, the tax would have been Rs 67,500 without relief, but with the relief provision, it was reduced to Rs 50,000. Sitharaman explained that only when an individual’s salary reaches Rs 12.75 lakh, the tax liability becomes Rs 71,250, with or without marginal relief.
Advertisment
View this post on Instagram
Raghav Chadha’s criticism of Middle-Class Taxation
Earlier in Parliament, Aam Aadmi Party MP had criticized the government’s scheme of handling middle-class taxation. He argues that while the poor receive subsidies and the rich benefit from loan waivers, the middle class is left without notable financial relief. Chadha said,
Advertisment
“The middle class is like a hen that lays golden eggs, yet it is squeezed at every opportunity. Rising GST rates, stagnant wages, and increasing financial pressures are crushing their aspirations”
He emphasized the burden of taxes on education, housing, healthcare, and essential goods, nudging the government to introduce more middle-class-friendly policies.
ADVERTISEMENT
Sitharaman’s spoke in defense of Middle-Class Taxation
Sitharaman defended the budget provisions, stressing that the new tax regime offers zero tax liability for those earning up to Rs 12 lakh, while marginal relief prevents sudden tax leaps for those earning slightly above that threshold.
The argument over middle-class taxation remains a controversial issue, with opposition leaders trying to lower GST rates and additional tax deductions, while the government claims that recent changes have eased the tax burden.
ADVERTISEMENT
Aam Aadmi Party MP Raghav Chadha expressed Union Finance Minister Nirmala Sitharaman tried to complicate his words
On Friday Aam Aadmi Party MP Raghav Chadha expressed that when he shared his point on the income tax rebate announced in Budget 2025 the day before, Union Finance Minister Nirmala Sitharaman tried to complicate his words at the Rajya Sabha. He said,
“Yesterday the Union Finance Minister Nirmala Sitharaman in the Rajya Sabha said I tried to mislead the house. I was not allowed to even reply to her questions”
The AAP MP also added that the finance minister did not answer his other questions concerning issues faced by railway passengers and economic problems faced by the middle class. He said,
“I raised various issues in my speech on the Union Budget like the issues being faced by railway passengers, financial challenges of the middle class, tariffs imposed by the Donald Trump administration or the falling rupee. She did not reply on these issues but on my example to explain the Income Tax rebate, she made a lot of statements”
Chadha alleged that Sitharaman had made personal attacks on him
In the three-minute-long video, he said,
“I want to say that I have a lot of love and respect for the Honourable Finance Minister. She is older than me in terms of experience and age. I hope that in future she refrains from making such personal statements”
This came as response to Sitharaman’s statement at Rajya Sabha saying she did not see the “strength of a chartered accountant” in his interventions. She added,
“It makes me question if I am really right thinking that you are a chartered accountant”
Here is what he said
Yesterday, in Parliament the Hon’ble Finance Minister made charges against me. Here is my response:
माननीय वित्त मंत्री द्वारा कल अपने भाषण में मुझपे की गई व्यक्तिगत टिपण्णियों पर मेरा जवाब pic.twitter.com/29ubmFEkRn
— Raghav Chadha (@raghav_chadha) February 14, 2025
What are your thoughts about it? Let us know in the comments.
