| Income Range | Income Tax Rate |
|---|---|
| Up to Rs. 3,00,000 | Nil |
| Rs. 300,000 to Rs. 6,00,000 | 5% on income which exceeds Rs 3,00,000 |
| Rs. 6,00,000 to Rs. 900,000 | Rs 15,000 + 10% on income more than Rs 6,00,000 |
| Rs. 9,00,000 to Rs. 12,00,000 | Rs 45,000 + 15% on income more than Rs 9,00,000 |
| Rs. 12,00,000 to Rs. 1500,000 | Rs 90,000 + 20% on income more than Rs 12,00,000 |
| Above Rs. 15,00,000 | Rs 150,000 + 30% on income more than Rs 15,00,000 |
India has recently introduced a new tax slab system in its Union Budget 2020. This new tax slab system comes with lower tax rates but without exemptions and deductions. This new tax slab system is optional, and taxpayers can choose to continue with the existing tax slab system.
The new income tax regime, which is set to come into effect from the financial year 2023-24, has been a topic of much discussion and speculation in recent times. The government has proposed significant changes to the tax structure, which is aimed at simplifying the tax filing process and providing relief to taxpayers.
Under the new tax regime, taxpayers will have the option to choose between the existing tax structure and the new tax structure. The new structure is expected to benefit those taxpayers who do not claim many deductions and exemptions.
Here are some of the key features of the new income tax regime:
Lower tax rates: The new tax regime proposes lower tax rates as compared to the existing structure. The tax rates will range from 5% to 20%, depending on the income slab.
No deductions and exemptions: The new tax regime does not allow any deductions or exemptions, except for certain specified ones such as contribution to the National Pension System (NPS) and payment of health insurance premium.
No tax on long-term capital gains: Under the new tax regime, long-term capital gains on equity investments will be exempt from tax.
Simplified tax filing: The new tax regime is expected to simplify the tax filing process as there will be no need to compute deductions and exemptions.
Opt-in basis: The new tax regime is optional and taxpayers can choose between the existing and new regime, whichever suits them best.
It is important to note that the new tax regime may not necessarily result in lower tax liability for all taxpayers. Those who claim a large number of deductions and exemptions may find it more beneficial to continue with the existing regime.
In conclusion, the new income tax regime proposed for the financial year 2023-24 is expected to bring significant changes to the tax structure. It offers lower tax rates and simplified tax filing, making it an attractive option for taxpayers who do not claim many deductions and exemptions. However, it is important for taxpayers to carefully evaluate their tax liability before deciding whether to opt for the new tax regime or continue with the existing one.
