Good News For Middle Class: Personal Income Tax Slabs Revised, Standard Deduction Increased To 75K

New Delhi: “For those opting for the new tax regime, the standard deduction for salaried employees to be increased from Rs 50,000 to Rs 75,000”, Union Finance Minister Nirmala Sitharaman announced on Tuesday, while presenting Budget 2024. "Coming to personal income tax rates, I have two announcements to make for those opting for the new tax regime. First, the standard deduction for salaried employees is proposed to be increased from Rs 50,000 to Rs 75,000. Similarly, the deduction on family pension for pensioners is proposed to be enhanced from Rs 15,000 to Rs 25,000. This will provide relief to about 4 crore salaried individuals and pensioners," Finance Minister Nirmala Sitharaman said.  

"Second, in the new tax regime, the tax rate structure is proposed to be revised as follows: Rs 0-3 lakh - Nil; Rs 3-7 lakh - 5%; Rs 7-10 lakh - 10%; Rs 10-12 lakh - 15%; Rs 12-15 lakh - 20%; and Rs 15 lakh and above - 30%," she added.   

New Income Tax Slabs Under the New Tax Regime

• Up to 3,00,000: Nil
• From 3,00,001 to 7,00,000: 5%
• From 7,00,001 to 10,00,000: 10%
• From 10,00,001 to 12,00,000: 15%
• From 12,00,001 to 15,00,000: 20%
• Above 15,00,000: 30%

Angel Tax Abolished

"Monetary limit for filing Tax appeals increased to Rs 60 lacs for ITAT, Rs 2 crores for High Courts and Rs 5 crores for Supreme Court...I propose to abolish the Angel tax abolished for all classes of investors. Corporate tax rate to be reduced on foreign companies from 40 to 35 per cent...", said Sitharaman. 

FM Sitharaman On New Personal Income Tax Regime

• Effort to simplify the process
• Simplifying the tax regime for charities 
• Two tax exemption regimes proposed to be merged into one for charities
• Credit for TCS to be given on TDS
• Plan to make SOP for TDS Defaults 
• Simplification of re-assessment 
• Capital gains taxations to be simplified

Last year, the basic exemption limit under the new tax regime was raised to Rs 3 lakh. 

Highlights From Nirmala Sitharaman's Budget Speech 

India's Economic Performance:

Economic growth remains a bright spot and is expected to continue its positive trajectory.
Inflation is low and stable, moving towards the 4% target.  

Economic Focus:

Emphasis on supporting the poor, women, youth, and farmers.
Higher Minimum Support Prices (MSP) for major crops ensure at least a 50% margin over production costs.
Extension of PM Garib Kalyan Anna Yojana for 5 years, benefiting over 80 crore people.

Budget Allocations and Focus Areas:

1.48 lakh crore rupees allocated for education, employment, and skill development.
Focus on employment, MSME (Micro, Small, and Medium Enterprises), and the middle class.
Highlighted commitment to employment, skilling, and social justice in the FM’s budget speech.