Union Finance Minister Nirmala Sitharaman presented the country's Union Budget 2020-21 in Parliament today. Is there any change in the income tax slab in the budget? This was the focus of the working class. But Nirmala Sitharaman's first budget of the decade didn't have much for the common man.'''
No change were made to the personal income tax slab by the government. Therefore, taxpayers will have to pay income tax this year as well as last year.
While tabling the Union budget 2021-22 in Parliament, the minister said that the number of income tax return filers has increased to 6.48 crores now from 3.48 crores in 2014. Finance Minister has announced that the tax audit limit has been increased from Rs 5 crore to Rs 10 crore. In addition, senior citizens above 75 years of age with only pension and interest incomes have been exempted from filing tax returns.
As there is no change in the income tax slab, the tax structure will remain the same as last year. Income up to Rs 2.5 lakh is tax free. This means that those with an annual income of up to Rs 2.5 lakh will not have to pay income tax. Income between Rs 2.5 lakh and Rs 5 lakh will be subject to 5 per cent income tax. Under the new tax regime, an individual earning between Rs 5 to Rs 7.5 lakh will have to pay tax at 10 per cent against the earlier 20 per cent. Similarly, for those earning between Rs 7.5 lakh to 10 lakh, the tax rate has been reduced to 15 per cent against the earlier 20 per cent. Income between Rs 10 lakh to Rs 12.5 lakh will invite a tax of 20 per cent, against the current 30 per cent.
Earnings between Rs 12.5 and Rs 15 lakh will be taxed at 25% from 30%; above Rs 15 lakh at 30% (no change).For example, a person earning Rs. 15 lakh in a year and not availing any deductions etc., will pay only Rs. 1,95,000 as compared to Rs. 2,73,000 in the old regime. Thus, his tax burden shall be reduced by Rs. 78,000 in the new regime.