Income Tax Slabs revised, BIG relief to middle class | LIVE
Income Tax Slab Revision 2020-21: Finance Minister Nirmala Sitharaman on Saturday delivered major relief to tax payers by slashing tax rates and restructuring the tax slabs. Presenting the Budget 2020 in the Lok Sabha, Sitharaman proposed to bring a personal income tax regime, where income tax rates will be reduced, so now, person earning between Rs 5 to 7.5 lakhs will be required to pay tax at 10 per cent against current 20 per cent. She also announced that those with income between Rs 7.5 to10 lakhs will pay tax at 15 per cent against current 20 per cent and those with income between Rs 10 to12.5 lakhs will pay tax at 20 per cent against 30 per cent.
The proposal would lead to a revenue sacrifice of Rs 40,000 crore per annum, she added.
Thought the Finance Minister announced major relief for salaried tax payers, she also laid a crucial condition with it. She said the new tax rates and slabs are optional and can be availed only by those tax payers who forego reliefs, exemptions. Nirmala Sitharaman said the government has removed 70 exemptions, deductions with a view to further simplify tax regime.
Observing that there are about 100 tax exemptions and deductions, she said that 70 of them are being removed in the new simplified tax regime, while the remaining will be reviewed and examined in due course.
Citing an example, she said, a person earning Rs 15 lakh per annum would be able to save Rs 78,000 in taxes by opting for the new tax regime.
Budget 2020: Revised Tax slab rates
|
Income Tax Slab |
Old |
Revised tax slab |
|
Upto Rs 5 lakhs |
NA |
NA |
|
From Rs 5 to Rs 7.5 lakh |
20% |
10% |
|
From Rs 7.5 to Rs 10 lakh |
20% |
15% |
|
From Rs 10 to Rs 12.5 lakh |
30% |
20% |
|
From Rs 12.5 lakh to Rs 15 lakh |
30% |
25% |
|
Above 15 lakh |
30% |
30% |
Budget 2020: Comprehensive Coverage
What is an Income Tax Slab?
Income Tax Slabs basically consist of different tax rates that get levied on the Income of a person. Different Tax Rates are applied on Different Income slabs for the current financial year starting from 1st April and ending on 31st March.
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