
Budget 2025: Finance Minister Nirmala Sitharaman made essential adjustments to income tax bands in Budget 2025, a major step to lessen the tax burden. The nil tax slab is now worth ₹12 lakh instead of ₹7 lakh.
The exemption from income tax will now apply to taxpayers making up to ₹12 lakh. With a standard deduction of ₹75,000, the taxable income threshold for salaried individuals rises to ₹12.75 lakh. The previous ₹7 lakh cap has been significantly lowered, enabling more taxpayers to keep their whole income.
With the current inflation, zero tax up to ₹12 lakh is expected to be transformative and provide some relief to the middle class,” stated Kumarmanglam Vijay, Partner, JSA Advocates & Solicitors concerning Income Tax. If adequately managed, leaving more money in the middle class should encourage personal investments and bode well for the economy.
Seniors will also receive increased tax benefits in addition to modifications to the income tax slab. The ₹50,000 deduction cap on interest income has been increased to ₹1 lakh. To increase household savings, consumption, and investment, the government anticipates that the new structure will significantly lower taxes for the middle class.
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