Only 5 percent income tax will have to be paid on taxable income up to ₹7 lakh. Earlier, only 5 percent tax had to be paid on income up to ₹6 lakh, and 10 percent tax had to be paid on income from ₹6 lakh to ₹9 lakh.
New tax regime: The central government has given a gift to those who choose the new income tax system, and only 5 percent income tax will have to be paid on taxable income up to ₹ 7 lakh. Earlier, only 5 percent tax had to be paid on income up to ₹ 6 lakh, and 10 percent tax had to be paid on income from ₹ 6 lakh to ₹ 9 lakh. Apart from this, the standard deduction for taxpayers choosing the new tax regime, i.e. NTR, has also been increased from ₹ 50,000 to ₹ 75,000.
Union Finance Minister Nirmala Sitharaman announced the new tax slab while presenting the General Budget 2024-25. Now taxpayers calculating income tax under NTR will not have to pay any tax on income from zero to ₹ 3 lakh as before. 5 percent tax will be levied on income from ₹3 lakh to ₹7 lakh, 10 percent tax will be levied on income from ₹7 lakh to ₹10 lakh, 15 percent tax will be levied on income from ₹10 lakh to ₹12 lakh, 20 percent tax will be levied on income from ₹12 lakh to ₹15 lakh, and 30 percent income tax will have to be paid on income above ₹15 lakh as before.
Due to this announcement of increase in standard deduction, the taxable income of any taxpayer paying tax under the new tax regime will be reduced by Rs 25,000, due to which he will have to pay Rs 1,300 less income tax including health and education cess. Apart from this, due to the change in slabs, the taxpayer will have to pay 5% income tax instead of 10% on income of Rs 1 lakh, due to which he will have to pay Rs 5,200 less income tax including health and education cess.
By the way, taxpayers whose taxable income is Rs 10 lakh or more, will get a benefit of Rs 5,200 in addition to Rs 6,500. Actually, due to the change in tax slabs, now only 10% tax will have to be paid on income from Rs 7 lakh to Rs 10 lakh, whereas now 15% tax had to be paid on income above Rs 9 lakh. So, at least 5% less tax will be paid on income of ₹1 lakh, due to which an additional benefit of ₹5,200 will be available to those taxpayers whose taxable income is ₹10 lakh or more.
If we talk about those taxpayers who are earning more than ₹15 lakh, and are paying income tax under the 30% slab, then they are going to save a total of ₹18,200 including cess due to the increase of ₹25,000 in standard deduction and change in slab.
