Budget 2024: No tax on annual income up to Rs 8.5 lakh if basic exemption hiked to Rs 5 lakh | Here are possible tax slab changes

July 10,2024

Union Budget 2024: Finance Minister Nirmala Sitharaman will present her first budget in the Modi 3.0 regime on July 23 in Parliament. Overall, this will be her seventh straight budget presentation with an interim one presented in February this year.

With just a fortnight to go before the Union Budget 2024, taxpayers, especially those in the middle-class, are hoping for some much-needed tax relief measures from the Modi government. They are particularly looking for the government to raise the basic exemption limit from Rs 3 lakh to Rs 5 lakh, increase the standard deduction limits, and introduce new deduction benefits under the new tax regime.

What are the deduction benefits available currently under new tax regime?

Currently, the new tax regime only offers a standard deduction benefit of Rs 50,000, with no other deductions and exemptions like those available under the old tax regime.

In the upcoming budget, experts too anticipate a significant change in the tax structure. They are of the view that the government may increase the basic tax exemption limit under the new tax regime from Rs 3 lakh to Rs 5 lakh per annum.

What will be tax-free income under new tax regime if basic exemption limit hiked to Rs 5 lakh?

If this hike is implemented, it would mean that individuals with an annual income of up to Rs 8.5 lakh could potentially pay no income tax. This calculation takes into account the standard deduction and the rebate under section 87A, assuming it remains unchanged, feels CA Satish Surana.