Budget 2023: Income tax rebate increased to Rs 7 lakh under new regime, says FM Sitharaman
FM Sitharaman announces big relief for middle class
- Feb 1, 2023,
- Updated Feb 1, 2023 12:45 PM IST
In her Budget 2023 speech, Finance Minister Nirmala Sitharaman announced no income tax will be levied on those who earn up to Rs 7 lakh under new tax regime, which was earlier Rs 5 lakh.
In her Budget 2023 speech, Sitharaman announced a common income tax return for easy and smooth ITR filing.
Next generation common IT form has been rolled out for MSMEs and professionals - if their cash receipts is no more than 5% then presumptive tax limits has been increased to Rs 3 crore (turnover) and Rs 75 lakh (income), respectively.
A person earning Rs 9 lakh a year will now be paying just Rs 45,000 instead of Rs 60,000 currently. Similarly, a person earning Rs 15 lakh will now pay only 10% of this as tax.
"The highest tax rate in our country is 42.74%, it is among the highest in the world. I propose to reduce the highest surcharge rate from 37% to 25% in the new tax regime. This will result in the reduction of the maximum tax rate to 39%," said Sitharaman in Parliament.
"Govt proposes to cap deductions from capital gains on investments in residential houses to Rs 10 crore. Net tax revenue foregone because of changes in direct and indirect taxes is Rs 35,000 crore," said FM Sitharaman.
An individual with income of Rs 15 lakh will have to pay Rs 1.5 lakh tax, down from Rs 1.87 lakh under new tax structure, she said adding that the government proposes to make new tax structure as default tax option.
In her Budget 2023 speech, Finance Minister Nirmala Sitharaman announced no income tax will be levied on those who earn up to Rs 7 lakh under new tax regime, which was earlier Rs 5 lakh.
In her Budget 2023 speech, Sitharaman announced a common income tax return for easy and smooth ITR filing.
Next generation common IT form has been rolled out for MSMEs and professionals - if their cash receipts is no more than 5% then presumptive tax limits has been increased to Rs 3 crore (turnover) and Rs 75 lakh (income), respectively.
A person earning Rs 9 lakh a year will now be paying just Rs 45,000 instead of Rs 60,000 currently. Similarly, a person earning Rs 15 lakh will now pay only 10% of this as tax.
"The highest tax rate in our country is 42.74%, it is among the highest in the world. I propose to reduce the highest surcharge rate from 37% to 25% in the new tax regime. This will result in the reduction of the maximum tax rate to 39%," said Sitharaman in Parliament.
"Govt proposes to cap deductions from capital gains on investments in residential houses to Rs 10 crore. Net tax revenue foregone because of changes in direct and indirect taxes is Rs 35,000 crore," said FM Sitharaman.
An individual with income of Rs 15 lakh will have to pay Rs 1.5 lakh tax, down from Rs 1.87 lakh under new tax structure, she said adding that the government proposes to make new tax structure as default tax option.