In the Union Budget 2024, Finance Minister Nirmala Sitharaman improved the new income tax regime by increasing the standard deduction from Rs 50,000 to Rs 75,000, resulting in a rise of Rs 25,000. This adjustment is expected to save salaried individuals Rs 17,500 under the new tax regime. Furthermore, the Finance Minister revised several tax slabs.
#WATCH | On personal income tax rates in new tax regime, FM Sitharaman says, “Under new tax regime, tax rate structure to be revised as follows – Rs 0-Rs 3 lakh -Nil; Rs 3-7 lakh -5% ; Rs 7-10 lakh-10% ; Rs 10-12 lakh-15%; 12-15 lakh- 20% and above Rs 15 lakh-30%.” pic.twitter.com/zQd7A4OsnT
— ANI (@ANI) July 23, 2024
The revised income tax slabs are now as follows: income up to Rs 3 lakh is taxed at 0%, income between Rs 3 lakh and Rs 7 lakh is taxed at 5%, income between Rs 7 lakh and Rs 10 lakh is taxed at 10%, income between Rs 10 lakh and Rs 12 lakh is taxed at 15%, income between Rs 12 lakh and Rs 15 lakh is taxed at 20%, and income exceeding Rs 15 lakh is taxed at 30%.
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Previously, under the new income tax regime, income up to Rs 3 lakh was tax-free, income from Rs 6 lakh to Rs 9 lakh was taxed at 10%, income from Rs 9 lakh to Rs 12 lakh was taxed at 15%, income from Rs 12 lakh to Rs 15 lakh was taxed at 20%, and income above Rs 15 lakh was taxed at 30%.
Specifically, the changes affect three slab categories: the slab for income over Rs 3 lakh to Rs 6 lakh, previously taxed at 5%, is now Rs 3 lakh to Rs 7 lakh; the slab for income from Rs 6 lakh to Rs 9 lakh, previously taxed at 10%, is now Rs 7 lakh to Rs 10 lakh; and the slab for income over Rs 9 lakh to Rs 12 lakh, previously taxed at 15%, is now Rs 10 lakh to Rs 12 lakh.
