Sat Feb 01 07:10:00 UTC 2025: **India Announces Major Tax Relief for Middle Class in Budget 2025**
NEW DELHI – Finance Minister Nirmala Sitharaman unveiled a significantly revised income tax structure in the Modi government’s latest budget, offering substantial relief to the middle class. The new tax regime, effective immediately, declares income up to ₹12 lakh tax-free, incorporating a ₹75,000 standard deduction.
The changes simplify the tax slabs, eliminating the previous system’s complexities. The new rates are:
* ₹0-₹4 lakh: 0%
* ₹4-₹8 lakh: 5%
* ₹8-₹12 lakh: 10%
* ₹12-₹16 lakh: 15%
* ₹16-₹20 lakh: 20%
* ₹20-₹24 lakh: 25%
* Above ₹24 lakh: 30%
This represents a departure from the previous year’s tax slabs. The introduction of a 25% tax bracket is a notable feature of this revision.
The impact of these changes is substantial. For example, an individual earning ₹15 lakh annually would see a savings of approximately ₹32,500 compared to the 2024-25 tax regime. Those earning ₹12 lakh or less will now pay zero income tax, a major shift from previous years. Savings increase progressively with higher incomes; those earning ₹25 lakh or more can expect savings exceeding ₹1.1 lakh.
The government claims this restructuring will put more disposable income into the hands of the middle class, stimulating economic activity. However, the long-term economic effects of this significant tax overhaul remain to be seen.
First Piper 