The Indian budget was positively received by most people today, and it has got a bit of good news for people who pay income tax.
The tax slabs have changed, and it translates into a Rs.50,000 savings for incomes up to Rs. 8 lakhs. Any amount over that will continue to be taxed at the earlier rate.
The new slab is as follows:
Income up to 1.6 lakhs: 0
From 1.6 to 5 lakhs: 10%
5 to 8 lakhs: 20%
Above 8 lakhs: 30%
This is a welcome change and if you compare it with the earlier slab – someone earning 8 lakhs will save Rs.50,000. This is of course a simplification, as it does not take into account the deductions you get from investments, EMI payments or other things like the LTA tax or HRA tax for example.
I feel happy to be able to write about this good news especially because I recently had a post an another bit of good news for Indian savers.
The bad news is that fuel prices will go up a bit, but in the larger scheme of things deregulation of fuel prices is a good thing for the Indian economy.