Budget 2024: On February 1, 2024, Union Finance Minister Nirmala Sitharaman will present the interim Union Budget 2024-25. However, there will likely be no major announcements in this budget as the Lok Sabha Election 2024 is due in April-May this year.
From new tax regime to changes in rebates, let’s take a quick look at six top income tax announcements made by Finance Minister Nirmala Sitharaman while presenting the Union Budget 2023
1)Tax rebate limit raised
The rebate limit in the new tax regime has been increased to ₹7 lakh, meaning that persons in the new tax regime with income up to ₹7 lakh will not have to pay any tax.
2) Changes in income tax slabs
In a bid to provide major relief to all taxpayers in the new regime, the tax structure in the new personal tax regime has been changed by reducing the number of slabs to five and increasing the tax exemption limit to ₹3 lakh.
0-3 lakh – nil
3-6 lakh – 5%
6-9 lakh- 10%
9-12 lakh – 15%
12-15 lakh – 20%
above 15 lakh- 30%
3) Standard deduction benefit under the new income tax regime
The benefit of standard deduction has been extended to the salaried class and the pensioners including family pensioners under the new tax regime. The salaried individual will get a standard deduction of ₹ 50,000 and pensioners ₹ 15,000.
4) Highest surcharge rate
The highest surcharge rate in personal income tax has been reduced from 37% to 25% in the new tax regime for income above ₹2 crore. This would result in the maximum tax rate of personal income tax coming down to 39% which was earlier 42.74%.
5) Tax exemption on leave encashment
The limit of tax exemption on leave encashment on retirement of non-government salaried employees has been increased from ₹3 lakh to ₹25 lakh.
6) New income tax regime to be default regime
The new income tax regime has been made the default tax regime. However, the citizens will continue to have the option to avail the benefits of the old tax regime.
Visit www.cagurujiclasses.com for practical courses
