Pioneer News Service
Presenting her eighth straight Budget in the Lok Sabha-a record of sorts, the Union Finance minister Nirmala Sitharaman gave massive relief to the middle class, exempting annual income of up to Rs 12 lakh from income tax and taking things further towards the next generation reform, rejigged tax slabs. Individuals earning up to Rs 12 lakh annually will not have to pay any income tax under the new tax regime. Significantly, for the salaried employees, this nil tax limit will reach up to Rs 12.75 lakh per annum with a standard deduction of Rs 75,000 taken into account.
Higher exemptions and rejigs have been effected under the new income tax regime.
“The new structure will substantially reduce the taxes of the middle class and leave more money in their hands, boosting household consumption, savings and investment,” Sitharaman said.
As per the budget proposals, for people earning more than Rs 12 lakh per annum, there will be nil tax for income up to Rs 4 lakh, 5 per cent for income between Rs 4 and 8 lakh, 10 per cent for Rs 8-12 lakh, 15 per cent for Rs 12-16 lakh.
A 20 per cent income tax will be levied on income between Rs 16 and 20 lakh, 25 per cent on Rs 20-24 lakh and 30 per cent above Rs 24 lakh per annum. A tax payer in the new regime with an income of Rs 12 lakh will get a benefit of Rs 80,000 in tax. A person having income of Rs 18 lakh will get a benefit of Rs 70,000 in tax. A person with an income of Rs 25 lakh gets a benefit of Rs 1.10 lakh.
