Budget 2023: Income Tax rebate limit raised to ₹7 lakh from ₹5 lakh

01-02-2023 : In a huge relief to salaried and middle class, Union Finance Minister Nirmala Sitharaman, while presenting Union Budget 2023-24 in Parliament today, said the income tax rebate has been extended on income up to ₹7 lakh under the new tax regime, up from ₹5 lakh so far. The FM also announced there will not be any new tax for income up to ₹3 lakh.

According to the finance minister, the five major announcements in income tax will benefit India’s “hard-working middle class”. “The first one concern rebate. Currently, those with income up to ₹5 lakh do not pay any income tax in both old and new tax regimes. I propose to increase the rebate limit to ₹7 lakh in the new tax regime. Thus, persons in the new tax regime, with income up to ₹7 lakh will not have to pay any tax,” she said.

She also proposed to change the tax structure in the personal income tax regime by reducing the number of slabs and increasing the tax exemption limit to ₹3 lakh. “The new tax rates are 0 to ₹3 lakh – nil, ₹3 to 6 lakh – 5%, ₹6 to 9 lakh – 10%, ₹9 to 12 lakh – 15%, ₹12 to 15 lakh – 20% and above ₹15 lakh – 30%, ” Finance Minister Nirmala Sitharaman said during her speech in Parliament.