Finance Minister Nirmala Sitharaman has changed the income tax slabs for the new tax regime which is likely to benefit taxpayers.
Finance Minister Nirmala Sitharaman in her seventh Budget speech on July 23 revised the tax slabs under the new regime. She told the House that as a result of these changes, a salaried employee would be able to save up to ₹17,500 in income taxes.
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Union Finance Minister Nirmala Sitharaman presents the Union Budget 2024-25 in Lok Sabha, in New Delhi on July 23, 2024.
| Photo Credit:
PTI
Whilst the rate of taxation remains unchanged, the size of each of the slabs, excluding the initial zero to ₹3 lakh, remains unchanged. The erstwhile slab of ₹3 lakh to ₹6 lakh would now be expanded to ₹3 lakh to ₹7 lakh. However, the rate of taxation, that is 5%, remains unchanged. Similarly, the other slabs, that is, ₹6 to 9 lakhs, ₹9 to 12 lakhs, ₹12-15 lakhs and thereby beyond, would be revised to ₹7-10 lakhs, ₹10-12 lakhs, ₹12-15 lakhs and thereby beyond.
Earlier, the Finance Minister further placed increasing the standard deduction for salaried employees from current ₹50,000 to ₹75,000 under the new tax regime.
Ms. Sitharaman further announced deduction in family pension for pensioners to be enhanced from ₹15,000 at present to ₹25,000. She held the measure would provide relief to about 4 crore salaried and pensioner individuals.
Concluding her speech, the Finance Minister told the House that because of the taxation measures announced today, ₹37,000 crore would be foregone, which entails ₹29,000 in direct taxes and ₹8,000 in indirect taxes. However, with a realisation of ₹30,000 crore expected, the total foregone amount would stand at ₹7,000 crore.
