<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">In a major move to ease the tax burden on middle-class taxpayers, Finance Minister Nirmala Sitharaman on Saturday announced fresh tax slabs under the New Tax regime in the Union Budget 2025&ndash;26. <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">&nbsp;
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">The new tax slabs aim to provide relief to individuals earning up to <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12 lakh annually and the exemption limit is&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12.75 lakh for salaried individuals (including standard deductions).
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">Finance Minister Sitharaman said that after the changes made under the new tax regime, there will be a saving of <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹80,000 on an income of <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12 lakh, <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹70,000 on an income of&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹18 lakh, and&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹1,10,000 on an income of <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹25 lakh.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">Under the new tax slabs announced in the Budget, there is no tax on annual incomes up to <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹4 lakh.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">For income between <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹4 lakh and <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹8 lakh, the tax rate will be 5%, while incomes between <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹8 lakh and&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12 lakh will be taxed at 10%.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">For higher income brackets, the tax rates will increase progressively, with 15% for <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12 lakh to&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹16 lakh, 20% for&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹16 lakh to&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹20 lakh, 25% for&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹20 lakh to&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹24 lakh, and 30% for incomes above&nbsp;<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹24 lakh.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">In addition to the revised tax slabs, Finance Minister Sitharaman also announced an increase in the tax rebate available under Section 87A.<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">&nbsp;
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">This means that individuals with a net taxable income of up to <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12 lakh will not be required to pay any income tax.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">However, if your annual income is exactly <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹12 lakh, you will still pay tax according to the applicable slab rates but will benefit from the rebate, reducing your final tax liability.<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">&nbsp;
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">In simpler terms, if you're a salaried individual or earn other types of "regular income" up to ₹12 lakh, you will not have to pay any tax due to both the enhanced rebate and the revised tax slabs.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">However, income from capital gains will not be eligible for the rebate and will be taxed separately under different rules.<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">&nbsp;
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">The new tax regime will come into effect from the new financial year 2025&ndash;26, starting on April 1, 2025, provided the proposals are approved by Parliament.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">In the current structure, individuals earning up to <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹3 lakh will pay no tax, and tax rates increase incrementally as income rises.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">However, under the old tax regime, the basic exemption limit was <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹2.5 lakh, and individuals had access to a range of deductions.<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">&nbsp;
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">For income between <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹2.5 lakh and <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹5 lakh, a 5% tax rate was applied, while incomes between <span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">₹5 lakh and ₹10 lakh were taxed at 20%.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">For earnings above ₹10 lakh, a 30% tax rate applies.
<span style="font-family: 'Arial',sans-serif; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-family: 'Times New Roman'; color: #001e2f; background: white; mso-font-kerning: 0pt; mso-ligatures: none; mso-fareast-language: EN-GB;">&mdash;IANS

No income tax incurred on annual income up to ₹4 lakh  —File Photo

The new tax slab provides relief to individual earning up to ₹12 lakh annually

New Tax Slab From Budget Eases Middle Class's Burden

The new tax slab provides relief to individual earning up to ₹12 lakh annually

February 1, 2025 | 15:06 IST