New Delhi. Modi government has changed the entire tax slab giving the biggest relief in the history of income tax. Now even those earning up to 24 lakh rupees will get a chance to save 1.10 lakh rupees. Finance Minister Nirmala Sitharaman made such an announcement in the budget speech that the salaried people hit the jackpot. She has not only increased the relief of zero income tax to 4 lakhs but has also changed all the income tax slabs.
The Finance Minister wasn't worried about the national treasury losing Rs 1 lakh crore, so he made income up to Rs 12 lakh tax-free. The new tax system incorporates all of these modifications; the previous one has not been impacted in any way. Income tax has been directly raised to Rs 4 lakh under the new regime when it was previously zeroed up to Rs 3 lakh.
What will be the new tax slab?
Zero tax on income up to Rs 4 lakh
5% tax on income from Rs 4 to 8 lakh
10% tax on income from Rs 8 to 12 lakh
Only 15% tax on income from Rs 12 to 16 lakh
20% tax will be levied on income from Rs 16 to 20 lakh.
25% tax will be levied on income from Rs 20 to 24 lakh. Only income above Rs 24 lakh will be taxed at 30%.
Who will save how much money?
Those earning up to Rs 12 lakh will directly benefit by Rs 80,000.
Those earning between Rs 12 to Rs 18 lakh will benefit by Rs 70,000, which is a 33% benefit.
Those earning up to Rs 25 lakh will benefit by Rs 1.10 lakh, which is a 25% benefit under the old regime.
Separate benefit of Rs 75,000
The Finance Minister has not only excluded income up to Rs 12 lakh from the scope of income tax but has also maintained the standard deduction of Rs 75,000. In this way, the total tax exemption will be Rs 12.75 lakh. That is, those earning up to Rs 12 lakh 75 thousand will not be taxed. You will have to pay tax only on earning more than this and the slab has been reduced in that too.
