Experts urge inclusion of home loan interest deductions in India's new tax regime for 2025 budget

In the upcoming 2025 budget, experts are advocating for the inclusion of home loan interest deductions under the New Tax Regime. Currently, these deductions are only available in the Old Tax Regime, which has led many taxpayers to remain with it. The Institute of Chartered Accountants of India (ICAI) has proposed allowing a deduction of up to Rs. 2 lakh for home loan interest under the New Regime. They also suggest enabling the offset of house property losses against other income and allowing loss carry-forwards for eight years. Additionally, experts are calling for a comprehensive overhaul of the Income Tax Act to simplify tax compliance. Proposed changes include increasing maximum deductions on home loans to Rs. 5 lakh and reinstating benefits for first-time home buyers, which could encourage investment in affordable housing.