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New Tax Regime vs. Old Tax Regime: As per the Finance Minister’s announcement, no tax will be levied on income up to Rs 7 lakh under the new tax regime. However, there have been no changes to the old tax regime with exemptions like HRA. In the old tax regime, there is no income tax up to Rs 5 lakhs with various exemptions. Along with this, the basic income tax exemption limit has been increased to Rs 3 lakhs. This exemption limit in the old tax regime is Rs 2.5 lakhs.
Who will save how much?
With this move, if a person earns up to Rs 7 lakh, he will save Rs 33,800 annually by adopting the new tax regime. On the other hand, there will be savings of Rs 23,400 for income up to Rs 10 lakh and Rs 49,400 for income up to Rs 15 lakh. Apart from this, budget relief has also been granted to taxpayers with personal income of more than two crores. In this, the highest rate of cessation has been reduced from 37 percent to 25 percent. This will result in savings of around Rs 20 lakhs for a person with a salary income of around Rs 5.5 crore.
What is the standard deduction? In which taxpayers will get a refund of Rs 52,500
What is the new tax regime? (New Tax Regime)
Under the new revised tax regime, there will be no income tax up to Rs 3 lakh. On the other hand, 5 percent on income from Rs.3 lakh to Rs.6 lakh, 10 percent at Rs.6 to 9 lakh, 15 percent at Rs.9 lakh to Rs.12 lakh and 20 percent from Rs. .12 lakh up to Rs 15 lakh and over Rs 15 lakh you will pay 30 per cent tax on your income.
What became cheap and what became expensive after the budget
old tax regime (Old Tax Regime)
5 per cent on income from Rs 2.5 lakh to Rs 5 lakh, 10 per cent on income from Rs 5 lakh to Rs 7.5 lakh, 15 per cent on income from Rs 7.5 lakh to Rs 10 Rs 10 lakh to Rs 12.5 lakh There is a provision of 20 per cent tax on income between Rs 12.5 lakh to Rs 15 lakh, 25 per cent on income above Rs 15 lakh and 30 percent on income above Rs 15 lakh.