Budget 2023: Income tax rates could be lowered in new regime, says report
1 min read . Updated: 17 Jan 2023, 01:35 PM IST
Premium- In India, income tax is levied from a minimum individual earning of ₹5 lakh per year
India is considering lowering rates under its voluntary income tax framework and could introduce revised slabs in the upcoming Union Budget 2023 due on February 1, news agency Reuters reported today. However, a final decision would be taken by the Prime Minister's Office.
The finance ministry did not respond to a Reuters email seeking comment.
Under the option without deductions introduced in FY21, there are six slabs; 5%, 10%, 15%, 20%, 25%, and 30%, as against three under the one with benefits at 5%, 20%, and 30%.
Under the new tax regime, annual income of up to ₹2.5 lakh is exempt, while a 5% tax applies on annual income between ₹2.5-5 lakh. An income of ₹5-7.5 lakh attracts a reduced tax rate of 10% and 15% for income between ₹7.5 lakh and ₹10 lakh, 20% on ₹10-12 lakh, 25% on ₹12.5-15 lakh and 30% on above ₹15 lakh
Individuals can currently decide which set of rates they want to be taxed under.
Sitharaman will present Union Budget for 2023-24 in the Lok Sabha on February 1 amid expectations that the government will raise the income tax limit and provide relief to the middle class taxpayers, besides others.
Ahead of the Union Budget, Finance Minister Nirmala Sitharaman said on Sunday that she was aware of the pressures of the middle class.
"I too belong to the middle class so I can understand the pressures of the middle class. I identify myself with the middle class so I know," she said while speaking at a function organised by the Panchjanya magazine, an RSS- associated weekly.
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