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Income Tax in Budget 2023: New slab
The new tax regime in India has introduced a new tax slab system that replaces the previous multiple tax slabs with a lower number of tax rates. Under the new regime, the tax rates range from 5% to 30% for different income levels. Individuals earning up to Rs. 3 lakh per annum are exempt from paying tax, while those earning between Rs. 3 lakh and Rs. 6 lakh are taxed at 5%. The tax rate gradually increases for higher income levels, with those earning above Rs. 15 lakh per annum being taxed at 30%. Additionally, individuals have the option to choose between the old tax slab system or the new tax regime, whichever is more favorable to them. The new tax slab system is part of the government’s efforts to simplify the tax code and increase compliance, while also reducing tax evasion.
New tax slabs
Income of Rs 0-3 lakh is nil.
🔴 Income above Rs 3 lakh and up to Rs 6 lakh to be taxed at 5% under new regime.
🔴 Income of above Rs 6 lakh and up to Rs 9 lakh to be taxed at 10% under new regime.
🔴 Income of above Rs 9 lakh and up to Rs 12 lakh to be taxed at 15% under new regime
🔴 Income above Rs 12 lakh and up to Rs 15 lakh to be taxed at 20% under new regime.
🔴 Income above Rs 15 lakh to be taxed at Rs 30%.
Means
- Pay 5% tax between 3-6=15k tax
- pay 10% tax between 6-7 lacs= 10k
total Tax paid=25k
Govt will refund 25k
Old tax slabs
1) Income up to ₹2.5 is exempt from taxation under both regimes.
2) Income between ₹2.5 to ₹5 lakh is taxed at the rate of 5 per cent under the old as well as the new tax regime.
3) Personal income from ₹5 lakh to ₹7.5 lakh is taxed at a rate of 15 per cent under the old regime
4) Income between ₹7.5 lakh to ₹10 lakh is taxed at a rate of 20 per cent in the old regime
5) Under the old regime personal income above ₹10 lakh is taxed at a rate of 30 per cent.
India Budget 2023: A Look at the Key Highlights
