Your boss didn’t give you a raise: The new tax regime just did if you earn under ₹12.75 lakh

If your annual income is ₹12.75 lakh or less, you’ve just received a stealth raise, without your employer spending a rupee. That’s the message from financial consultant Madhav Pangarkar, who broke down the unexpected windfall offered by India’s new tax regime.

Writing on LinkedIn, Pangarkar points out that under the revamped structure, income up to ₹12 lakh is tax-free, and when combined with the ₹75,000 standard deduction, the effective tax-free limit rises to ₹12.75 lakh.

“You pay nothing. No advance tax. No stress about deductions. Just clean, straightforward relief,” Pangarkar wrote. At a monthly income of ₹1,06,250, that translates to zero income tax liability—a first for middle-income earners in that bracket under the new regime.

The revamped structure, designed to simplify compliance and eliminate the need for tax planning gymnastics, is being seen as both a middle-class relief measure and a strategic political play.

Pangarkar hints at this duality, asking: “Is this a long-term shift in tax philosophy—or just an election-season seduction?”

The new regime’s appeal lies in its clarity: no complex deductions, no paperwork-heavy exemptions, no need for tax-saving investments. For many, it offers more take-home pay with less mental load.

However, not all taxpayers may benefit equally. Those with substantial investments in 80C instruments or home loans may still find the old regime more tax-efficient.