Budget 2023: Huge Income Tax Relief, No Income Tax Up To ₹7 Lakh, Revised Tax Slabs For New Regime

Union finance minister Nirmala Sitharaman announced a big ticket budget ahead of next year’s general elections which included huge capital outlay in infrastructure and agri sectors and reworked tax slabs in a relief to the middle class.

There will be no income tax up to ₹7 lakh in the new tax regime, announced Union finance minister Nirmala Sitharaman in the Union Budget 2023 on Wednesday. “The government proposes to increase income tax rebate limit from ₹5 lakh to ₹7 lakh in the new tax regime,” said Sitharaman.

The finance minister also proposed to hike tax exemption on leave encashment on the retirement of non-government salaried employees to ₹25 lakh from ₹3 lakh.

Revised tax slabs under new tax regime:

Income of ₹0-3 lakh – Nil.

Income above ₹3 lakh and up to ₹5 lakh will be taxed at 5 per cent.

Income of above ₹6 lakh and up to ₹9 lakh will be taxed at 10 per cent the under new regime.

Income more than ₹12 lakh and up to ₹15 lakh to be taxed at 20 per cent.

Income above ₹15 lakh to be taxed at 30 per cent.

The new income tax regime will be the default tax regime while the citizens will have the option to be in the old regime as well, the finance minister announced.