Sat Feb 01 12:18:53 UTC 2025: ## India Announces Sweeping Income Tax Reforms: No Tax on Annual Income Up to ₹12 Lakh
**New Delhi, India** – India’s Finance Minister Nirmala Sitharaman unveiled significant changes to the country’s income tax structure, promising tax relief for millions of citizens. The new regime, to be introduced in Parliament next week, will raise the threshold for zero income tax to ₹12 lakh per year, impacting an estimated 10 million taxpayers.
Sitharaman, addressing a press conference following her budget speech, described the reforms as a direct response to public demand, emphasizing the government’s commitment to simplification and ease of compliance. The revised tax slabs include a 5% rate for income between ₹4-8 lakh, 10% for ₹8-12 lakh, 15% for ₹12-16 lakh, 20% for ₹16-20 lakh, and 25% for ₹20-24 lakh. Income above ₹24 lakh will be taxed at a flat 30%.
The Finance Minister provided an example, highlighting that individuals earning ₹8 lakh annually will see their tax burden reduced from ₹30,000 to ₹20,000 under the new system. She reiterated that the government is proceeding with disinvestment plans without interruption. The new tax bill will replace the existing Income Tax Act, 1961, streamlining the tax compliance process. Sitharaman confirmed that the changes will be implemented through the standard legislative process, requiring parliamentary approval.
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