Kolkata: It can be said with a little exaggeration perhaps that the Union Budget 2025 contained a veritable income tax revolution. Designed for triggering consumption to breathe life into the economy, the income tax reliefs have brought unalloyed cheer to the middle-class taxpayers of the country, who will be left with significant disposable cash from FY26, thanks to the new income tax slabs, rates and rebates announced in the budget.
To be sure, the New Income Tax Bill 2025 also mentions income tax relaxations. But what does it exactly say? Have a sneak peek into what the New Income Tax Bill 2025 says. The Bill also carries the new Income Tax slabs and rates of income tax.
For income up to Rs 12 lakh a year
“A resident individual assessee shall be entitled to a deduction of 100% of income-tax payable or twelve thousand five hundred rupees, whichever is less, from the income-tax (computed before allowing the deduction under this section) chargeable on the total income for any tax year if the total income does not exceed five lakh rupees.
Where the total income of a resident individual assessee for any tax year is chargeable to tax under section 202(1), then from income-tax (computed before
allowing the deduction under this section) following deductions shall be allowed, if—
(a) the income does not exceed twelve lakh rupees, 100% of the income-tax payable or sixty thousand rupees, whichever is less;
(b) the income exceeds twelve lakh rupees, the income-tax payable on the total income, reduced by total income which is in excess of twelve lakh rupees.
(3) The deduction under sub-section (2), shall not exceed income-tax payable as per the rates provided in section 202(1).”
Fewer litigations
After the Bill is tabled in Parliament it will be sent to the Standing Committee on Finance, which will, in turn, seek the opinion of different stakeholders. Once the feedback is received, the committee will deliberate on those and make its recommendations. All this is time consuming and it is not clear right now when can the New Income Tax Bill 2025 come into effect. As already stated, the primary goal of the legislation is to make the cumbersome income tax laws simpler, shorter and pave the way for fewer litigations.
The most significant announcement in Budget 2025 for the middle class is the big tweaks in personal Income Tax which has made it clear that none earning up to Rs 12 lakh a year have to pay income tax at all. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
