Budget 2020: Income Tax slab reduced: Finance Minister

February 1: While presenting the Union Budget, 2020, Finance Minister Nirmala Sitharaman said that a new personal income tax regime would be reduced who forego deductions and exemptions.

Tax of only 10 percent will be charged to Rs 5 lakh-7.5 lakh income as against prevailing 20 percent rate. For those with income of Rs 7.5 lakh-10 lakh, a tax rate of 15 percent against 20 percent prevailing rate was announced. For income Rs 10-12.5 lakh, a rate of 20 percent will be charged as against 30 percent earlier.

For income between Rs 12.5 lakh-15 lakh will be taxed at 25 percent as against 30 percent. For those at Rs 15 lakh plus income, tax will be 30 percent. No income tax will be charged for income upto Rs. 5 lakh.

#Budget2020

Finance Minister #NirmalaSithraman announces major tax relief for individuals

➡️Income between Rs. 5-7.5 lakh – Tax rate 10%

➡️Income between Rs. 7.5-10 lakh – Tax rate 15%

➡️Income between Rs 10-12.5 lakh – Tax rate brought down to 20% from 30%#janjankabudget pic.twitter.com/EJQATaWjx3

— PIB India (@PIB_India) February 1, 2020

However, the new tax slabs are only applicable to people who do not opt for exemptions under the tax regime. Essentially, individual tax payers have now have the choice to choose between the two tax regimes depending on their requirements.

Around 70 of more than 100 income tax deductions and exemptions have been removed, in order to simplify tax system and lower tax rates.

Also Read: What will one lose if he/she opt for new tax rate… click to know