Budget 2023 | Here's the proposed income tax rates and slabs

Union Finance Minister Nirmala Sitharaman will present the full-year Budget 2023 on February 1, 2023. Citizens are awaiting the Budget announcements related to income tax slabs. The tax rate for individuals has not been changed since the FY2017-18. The only change that was introduced in February 2020 was the ‘New Tax Regime’. Now, experts want Budget 2023 to make changes to the slab rates to give more purchasing power to individuals and some relief to the employed taxpayers.

As per the current income tax provisions, an individual is required to pay taxes based on slab rates. The highest slab rate (after including surcharge and cess) for income exceeding Rs 5 crore in India is at present 42.744 percent. Tapati Ghose, Partner an Deloitte India wants the highest tax rate of 30 percent to be reduced to 25 percent and the threshold limit for the highest tax rate be increased from Rs 10 lakh to Rs 20 lakh. Therefore, the proposed highest slab rate (including surcharge and cess) can be reduced to 35.62 percent.

According to the old tax regime, if the total income of an individual is not more than Rs 2.5 lakh, the tax rate is nil.

Applicable surcharge and educational cess will be levied on the above.

Hong Kong – 17 percent

Singapore – 22 percent

Malaysia – 30 percent

Hence, it is recommended that India should ensure that tax rates fall in that range. Ghose said.