Personal Income Tax to go down after the budget

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.

6 thoughts on “Personal Income Tax to go down after the budget”

  1. Is There any chance that 1.6 L celing will go up to 2.5 some where because people who are in the category of 2 to 3 L find it diffucult with preaviling inflation and fule price.

    1. Karunakaran – This post was written for last year’s budget, so this is a bit dated. The big thing now is to hope that the Direct Tax Code brings in some relief to taxpayers year after next.

    1. 10 lakhs is a million, and 1 crore is 10 million, and a billion is 100 crores.

      You really are quite interested in this stuff aren’t you 🙂 The only time I saw people remotely interested in what a lakh was when Tata Nano was launched and promoted as the 1 lakh car.

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