“In 2024, significant salary increases are being planned for employees by Indian companies, despite the global economic slowdown. An approximately 9.8% salary bump is expected for employees, building on the noteworthy 10% increase observed in 2023.
However, the optimistic outlook for salaried leaders is met with a challenge due to the high-income tax policies in India. Personal income tax, ranging from 5% to 37%, and additional charges contribute to a notable tax burden. In contrast, countries like Hong Kong (15%), Sri Lanka (18%), and Singapore (22%) feature more favourable tax systems, rendering them attractive for top-tier talent. As we now transition to remote working and the globalization of businesses, there is a tangible threat that senior talent may be attracted to relocate to countries that offer the most efficient tax structures and a superior work-life quality and balance.
As India strives to position itself as a global powerhouse, there is a recognized necessity for policies aimed at mitigating the tax burden on salaried employees, particularly senior leaders. The pressing requirement of the hour lies in the meticulous crafting of policies that transcend mere attraction, emphasizing the importance of nurturing and retaining top-tier talent. This strategic approach stands as an indispensable element in fortifying the nation’s competitive edge on the global stage.
While major announcements may be postponed until after the 2024 General Elections, the interim Union Budget presents a significant opportunity to address ongoing concerns and establish a foundation for future economic growth.”
