Every budget year is important for taxpayers. New taxes The government makes all the changes related to the income tax in the budget. The last few years have been very important for salaried taxpayers because the Modi government brought a new tax regime.
Changes were also made in the old tax regime. Now the new tax regime is the default tax regime. The government is more focused on the new tax regime. The budget is going to be presented tomorrow on Tuesday. In such a situation, the government can again make changes in the tax. Let us know what is the old and new tax regime and what is the difference between these two. Will there be no tax on income up to Rs 10 lakh in the new tax regime this time?
There are 2 ways to file income tax return
Individual taxpayers have two regimes to file their income tax, the old and the new tax regime. The new tax system has now been made the default. That is, if a taxpayer does not choose income tax, then his tax calculation is done according to the new tax regime. Taxpayers have to give a declaration to get the old tax regime. The reason for this is that the government is more focused on the new tax regime.
New tax regime
Finance Minister Nirmala Sitharaman made several tax-related changes in the budget for the financial year 2023-24. The government has made many changes since the implementation of the new tax regime. The government had announced last year to make the new tax regime the default tax regime. There was no tax on income up to Rs 5 lakh in the new tax regime. Which was later increased from Rs 5 lakh to Rs 7 lakh. That is, there is no tax on income up to Rs 7 lakh in the new tax regime.
Old tax regime
Talking about the tax slab in the old tax regime, there is no tax on income up to Rs 2.5 lakh. Income from Rs 2.5 lakh to Rs 5 lakh will be taxed at the rate of 5%, income from Rs 5 lakh to Rs 10 lakh will be taxed at the rate of 20% and income above Rs 10 lakh will be taxed at the rate of 30%. In the old tax regime, there are about 70 deductions and exemptions like HRA, 80C, 80D, 80CCD, home loan principal, home loan interest rate, etc.
| Income Slab | Old Tax Regime | New Tax Regime (31 March 2023) | new tax regime (from 1 April 2023) |
| ₹0 – ₹2,50,000 | – | – | – |
| ₹2,50,000 – ₹3,00,000 | 5% | 5% | – |
| ₹3,00,000 – ₹5,00,000 | 5% | 5% | 5% |
| ₹5,00,000 – ₹6,00,000 | 20% | 10% | 5% |
| ₹6,00,000 – ₹7,50,000 | 20% | 10% | 10% |
| ₹7,50,000 – ₹9,00,000 | 20% | 15% | 10% |
| ₹9,00,000 – ₹10,00,000 | 20% | 15% | 15% |
| ₹10,00,000 – ₹12,00,000 | 30% | 20% | 15% |
| ₹12,00,000 – ₹12,50,000 | 30% | 20% | 20% |
| ₹12,50,000 – ₹15,00,000 | 30% | 25% | 20% |
| >₹15,00,000 | 30% | 30% | 30% |
Expectations from Budget 2024
Taxpayers are expecting changes in the budget. Many people expect that the government will increase the basic exemption limit from the current Rs 3 lakh to Rs 5 lakh. The new tax regime should be made more attractive than before. Taxpayers are expecting that the government should increase the limit of Rs 7 lakh to Rs 10 lakh. To encourage savings and investment among the middle income group, the tax exemption limit should be increased from Rs 7.5 lakh to Rs 10 lakh. Standard deduction should be increased.
