Good news for the middle class. Finance Minister Nirmala Sitharaman has announced revised tax slabs and rates under the new regime to reduce the burden for all taxpayers. There will be no tax burden on up to Rs 12 lakh annual income, except special income. The revised slabs will benefit those earning more than that from the next financial year.
Tax Slabs For FY25-26
Up to Rs 4 Lakh: Nil
Rs 4-8 lakh: 5%
Rs 8-12 lakh: 10%
Rs 12-16 lakh: 15%
Rs 16-20 lakh: 20%
Rs 20-24 lakh: 25%
Above Rs 24 lakh: 30%
Tax Slabs For FY24-25
Up to Rs 3 lakh: Nil
Rs 3-7 lakh: 5%
Rs 7-10 lakh: 10%
Rs 10-12 lakh: 15%
Rs 12-15 lakh: 20%
Above Rs 15 lakh: 30%
No Tax Up To Rs 12 Lakh
Those earning up to Rs 12 lakh annually won’t have to pay any income tax under the new regime. Add to it the standard deduction of Rs 75,000 and taxpayers with up to Rs 12.75 lakh annual income will have to pay zero tax.
The new structure will substantially reduce taxes of the middle class and leave more money in their hands, boosting household consumption, savings and investment, the Finance Minister said, adding that the government believes in the contribution of middle class in national building.
Under the new slabs, taxpayers with Rs 12 lakh annual income will get a benefit of Rs 80,000 and those earning Rs 18 lakh will get a benefit of Rs 70,000, Ms Sitharaman told the parliament. Providing the tax relief, she said the government will forego Rs 1 lakh crore revenue in direct taxes and Rs 2,600 crore based on tax proposals.
