India’s Budget 2023: No Income Tax on Income Up To Rs 7 Lakh

1 February 2023: Finance Minister Nirmala Sitharaman announced a major relief to India’s growing middle class. She said individuals earning Rs 7 lakh will not require paying income tax from the coming fiscal under the latest tax regime. 

At present, individuals earning Rs 5 lakhs do not require to pay any income tax on their taxable income, and now this limit has been extended up to Rs 7 lakh, the Finance Minister added. 

India’s Budget 2023: New Tax Slabs

According to the new tax regime, the following tax slabs will be applicable.

 

Tax Slab	Tax Rate
Up to Rs 3,00,000	0%
Rs 3,00,000 to Rs 6,00,000	5%
Rs 6,00,000 to Rs 9,00,000	10%
Rs 9,00,000 to Rs 12,00,000	15%
Rs 12,00,000 to Rs 15,00,000	20%
Above Rs 15,00,000	30%

 

While giving her speech on India’s Budget 2023, Finance Minister Nirmala Sitharaman discussed an example: An individual earning Rs 9,00,000 per annum will have to pay Rs 45,000 income tax under new tax slabs, which was Rs 60,000 under the old tax slab. Additionally, a person earning Rs 15,00,000 yearly will require paying Rs 1,50,000 tax instead of Rs 1,87,000. 

 

The finance minister also said that the government has proposed to decrease the highest surcharge rate from 37% to 25%, which will apply under the new taxation regime.  

Summary: India’s Budget 2023 for Individual Taxpayers

1. Under the new tax regime, the basic exemption limit has increased to Rs 3,00,000 from Rs 2,50,000.

 

2. Under Section 87A of the Income Tax Act, the rebate has increased from Rs 5,00,000 to Rs 7,00,000. 

 

3. Now, there are five income tax slabs under the new tax regime: 0% tax up to Rs 3 lakh, 5% tax on Rs 3 lakh to Rs 6 lakh, 10% tax on Rs 6 lakh to Rs 9 lakh, 15% tax on Rs 9 lakh to Rs 12 lakh, 20% tax on Rs 12 lakh to Rs 15 lakh, and 30% tax on over Rs 15 lakh.

 

4. The Finance Minister Nirmala Sitharaman has also proposed the increase of Rs 50,000 standard deduction for salaried persons. 

Suggested Posts

Why is Financial Planning Incomplete Without Life Insurance?

Top 6 Proven Ways to Deal with Rising Inflation [2023]

What are the Ways to Avoid Online Scams and Frauds?

Follow on Google News For More