Today the much awaited announcement of the budget 2023-24 is finally made. The central government today made the announcement . The income level has been raised for the income tax. No income tax is payable for people below the income of Rs. 7 lakh a year. Earlier the tax limit was only up to Rs. 5 lakh so far.
The change in the tax limit that has been made is only for those people who follow the new tax regime.
About the new tax regime.
The new tax regime was introduced in 2020. It has none of the usual exemptions on insurance premium , mutual funds and other investments. It had resulted a higher tax burden in many cases. The people who are choosing old regimes will continue to get exemptions on the investments, after which their final taxable income is calculated.
The new regime will implement a five slab structure. The no tax slab has also been raised by 50,000.
Income between 0-3 lakh will have zero tax rates. Earlier, this regime was zero to 2.5 lakh earlier.
But from further moving, income part from Rs 3 lakh and 6 lakh will be taxed at 5 percent. From 6 lakh to 9 lakh , the tax would be 10 percent. Further from 9 to 12 lakh , it will be 15 percent. Rs. 12 to 15 lakh will come up with the tax of 20 percent .
And at last the part of the income going above 15 lakhs will be taxed at 30 percent.
The finance minister also brought down the highest applicable tax in India after surcharges, from 42.7 percent to 39 percent.
The minister also stated that the old regimes had higher tax rates but several exemptions . They will be available on request only . The new regime will be considered the default system for everyone . Our finance minister surely added an advantage to the new scheme.
Salaried people with the income of Rs. 15.5 lakh or more can subtract Rs. 52,500 as the standard deduction while they are calculating their taxable income.