Budget 2023 | FM has over-delivered on the personal income tax front, says Tarun Bajaj

“It is a very good thing and it was something that was expected by the people. People were asking for it,” he said.

Currently, 7 income slabs are available under the new tax regime. According to it, annual income up to Rs 2.5 lakh is exempt from tax. Those individuals earning between Rs 2.5 lakh and Rs 5 lakh have to pay 5 percent tax. Income between Rs 5 and 7.5 lakh is taxed at 10 percent, while those between Rs 7.5 and 10 lakh at 15 percent.

These have been now restructured to;  zero tax  upto Rs 3 lakh income, 5 percent tax for Rs 3-6 lakh, 10 percent for  Rs 6-9 lakh, 15 percent to Rs 9-12 lakh, 20 percent to Rs 12-15 lakh, and 30 percent for an income of above Rs 15 lakh, in the new  Budget.

He believes, the measures announced in the new tax regime may get people to switch from the old tax regime to the new tax regime even when there is an option of retaining the old tax regime.

“If that happens and if the tax rates are what they are - this would be without any exemptions been given to the taxpayers – I think we will see as many number of people now shifting to the new tax regime,” he added.