FM Nirmala Sitharaman says now income up to Rs 7.27 lakh under the New Tax Regime has become tax-free due to the introduction of marginal relief provisions.
Talking about the steps taken by the Central Government for Middle-Class taxpayers in the last 9 years, Finance Minister Nirmala Sitharaman on Friday (July 14) said the tax-free income limit under New Tax Scheme has been increased to Rs 7.27 lakh.
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In Budget 2023, the FM announced that income up to Rs 7 lakh will become tax-free under the New Regime. However, concerns were raised as to what will happen to taxpayers who were earning marginally over Rs 7 lakh.
FM Sitharaman said the Government looked into such concerns and now income up to Rs 7.27 lakh under the New Tax Regime has become tax-free due to the introduction of marginal relief provisions.
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“Under the new regime, there is no income tax to be paid for annual income up to Rs 7 lakh, which effectively increases to Rs 7.27 lakh with marginal relief provisions,” the Finance Minister said.
Further, to make the new regime attractive, a standard deduction of Rs 50,000 was announced in Budget 2023. Before that, several tax experts had opined that the new regime was not attractive to taxpayers as no deductions were allowed like the old scheme.
FM Sitharaman said now a standard deduction of Rs 50,000 has also been introduced under the new income tax regime. The standard deduction facility is available to salaried employees.
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FM Sitharaman said that no section of the society has been omitted by the Centre in the last 9 years.
She also highlighted the tax-filing reforms that have resulted in the speedy filing and processing of income tax returns.
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“There has been a 100% increase in the total percentage of ITRs processed within one day of their filing compared to the previous year,” she said.
Further, the exemption limit on medical expenditure of senior citizens has been raised from Rs 30,000 to Rs 50,000. Also, life-saving drugs and cancer medicines are exempted from GST.
