Income Tax Slabs in Union Budget 2023-24: Zero tax for income up to Rs 7 lakh

The Union Finance Minister Nirmala Sitharaman announced that income tax rebate limit increased to Rs 7 lakh in new tax regime. The limit will be increased from Rs 5 lakh currently by Rs 2 lakh in an announcement which will bring a loud cheer to taxpayers.

FM further announced the average processing time for income tax returns will be reduced from 93 days to 16 days. Centre intends to roll out next-gen common IT Return forms. Government also aims to strengthen grievance redressal mechanism.

Government has also proposed to reduce highest surcharge rate from 37 percent to 25 percent in the new tax regime. An individual taxpayer with income of Rs 15 lakh will now have to pay Rs 1.5 lakh tax, which is Rs 37,000 less from Rs 1.87 lakh under new tax regime. 

An annual income of Rs 9 lakh will incur tax of only Rs 45,000. For income up to Rs 3 lakh, no tax. For Rs 3-6 lakh, 5 percent tax will be levied. Highest tax rate of 30 percent will be applicable above Rs 15 lakh under the new Income Tax regime. FM Sitharaman had introduced the new tax regime in Budget 2021-22.

Follow Budget presentation | Indian Union Budget 2023-24 LIVE Updates: Centre may raise tax slab to Rs 5 lakh, latest updates