Budget 2023: A Quick Glance At Old Vs New Current Income Tax Slabs

The salaried class is expecting that the Union Budget 2023-24 may alter tax slabs to make the new income tax regime more attractive

Notably, the income tax slabs remain unchanged since 2014 when the personal tax exemption limit was last revised. ( Image Source :Getty )

Finance Minister Nirmala Sitharaman is all set to announce the Modi 2.0 government's last Budget on Wednesday ahead of the Lok Sabha polls in 2024. The salaried class hopes for an income tax rebate from the Budget every year. It is expected that the Budget may alter tax slabs to make the new income tax regime more attractive.

Notably, the income tax slabs remain unchanged since 2014 when the personal tax exemption limit was last revised. FM Sitharaman introduced a new tax regime in the 2020 Budget. The government had then slashed the corporate tax slabs just before the pandemic hit that year. The salaried class was instead given the option to choose between the old tax regime of exemptions and standard deductions and a new concessional tax system without any deductions.

The rejig, which is expected this year, may aim at a gradual movement towards an exemption-less tax regime in the future, reported the publication Moneycontrol. Standard deduction hike, increase in 80C exemption, and rejigging tax slab rates are some of the expectations of the salaried class from this year's Budget.

Taxpayers can presently choose between the two regimes to pay their taxes. However, the new regime didn't find many takers and expected to see some of the important exemptions become a part of it, the Moneycontrol report added.

A look at existing income tax slab vs new income tax slab

1) Income up to Rs2.5 is exempt from taxation under both regimes.

2) Income between Rs2.5 to Rs5 lakh is taxed at the rate of 5 per cent under the old as well as the new tax regime.

3) Personal income from Rs5 lakh to Rs 7.5 lakh is taxed at a rate of 10 per cent under the new regime

4) Income between Rs7.5 lakh to Rs10 lakh is taxed at a rate of 15 per cent under the new

There are three slabs above the threshold of Rs10 lakh income

5) Personal income between Rs 10 lakh and Rs 12.5 lakh is taxed at a rate of 20 per cent under the new regime.

6) Income from Rs 12.5 lakh to Rs 15 lakh is taxed at 25 per cent

7) Income above Rs 15 lakh is taxed at a rate of 30 per cent.

Existing tax slabs

1) Income up to Rs 2.5 is exempt from taxation under both regimes.

2) Income between Rs 2.5 to Rs 5 lakh is taxed at the rate of 5 per cent under the old as well as the new tax regime.

3) Personal income from Rs 5 lakh to Rs 7.5 lakh is taxed at a rate of 15 per cent under the old regime

4) Income between Rs 7.5 lakh to Rs 10 lakh is taxed at a rate of 20 per cent in the old regime

5) Under the old regime personal income above Rs 10 lakh is taxed at a rate of 30 per cent.

ANNUAL INCOME           EXISTING REGIME           NEW REGIME

up to Rs 2,50,000                        Nil                               Nil

2,50,000-5,00,000                       5%                                5%

5,00,000-7,50,000                        20%                             10%

7,50,000-10,00,000                      20%                              15%

10,00,000-12,50,000                     30%                             20%

12,50,000-15,00,000                    30%                              25%

Above 15,00,000                          30%                             30%