In a big win for individual taxpayers, Union Finance Minister Nirmala Sitharaman on Saturday hiked the income tax exemption limit to Rs 12 lakh per annum under the New Tax Regime. She said from the next financial year, taxpayers will not have to pay income tax till Rs 12 lakh. Finance Minister Sitharaman said, “The middle class provide strengths to the economy. In recognition of their contribution, we have periodically reduced the tax burdens. I am now happy to announce that there will be no income tax up to an income of Rs 12 lakhs.” 

The Central government also allowed the individual taxpayers to claim annual value of two self-occupied properties as nil.

Check new tax regime:

Up to Rs 4 lakh – 0% 

Rs 4-8 lakh – 5% 

Rs 8-12 lakh – 10% 

Rs 12-16 lakh – 15% 

Rs 16-20 lakh – 20% 

Rs 20-25 lakh – 25% 

Above Rs 25 lakh – 30%

Nirmala Sitharaman said the personal Income Tax reforms will focus on the middle-class and the democracy, demography and demand are the key support builders in a journey towards ‘Viksit Bharat’. 

“The middle -class provides strength for India’s growth. This government under the leadership of the PM Modi has always believed in the admirable energy and ability of the middle-class in nation building. In recognition of their contribution, we have periodically reduced their tax burden. Right after 2014, the nil tax slab was raised to Rs 2.5 lakh, which was further raised to Rs 5 lakh in 2019 and to Rs 7 lakh in 2023. This is reflective of our government’s trust in the middle-class taxpayers. I am now happy to announce that there will be no income tax payable upto income of Rs 12 lakh.”

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