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”
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.
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.
thanks for the heads up on the taxes. Can you do me a favor and explain to me how many rupees one lakh is? And the one crore?
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.
I also feel fuel deregulation was essential even if it means little budget modifications to start with.
Yeah, deregulation along with implementation of the new tax code will be two major things as far as I am concerned.