Old Tax Slab: While on one hand the individuals of the nation are struggling with inflation, on the other hand the government is speaking about abolishing the Old Tax Slab system. Let us inform you that by abolishing the outdated tax system, there will be a direct impact on the pockets of the tax payers. Because a whole of 70 varieties of exemptions have been accessible in the outdated tax slab system, which will end with the end of this system. In this regard, Revenue Secretary Tarun Bajaj says that it is necessary to do this as a result of it will encourage taxpayers to undertake the new system.
There will be a direct impact on the pockets of taxpayers
The new tax system was began from 2020. The tax fee is low in this system, however as you have discovered in the article that 70 varieties of exemptions have been accessible in the outdated tax system, they will not be accessible now. And due to non-availability of deduction facility, until now the taxpayers have not been ready to undertake the new tax system. And nonetheless pay their taxes with the outdated tax system. This is the cause why Revenue Secretary Tarun Bajaj needs that the outdated system should be abolished. So that individuals’s attraction in direction of the outdated system ends and they are prepared to undertake the new system.
(*5*)No tax on quantity up to 5 lakhs
For data, allow us to inform you that in the budget of 2020 -2021 by the government, a new tax regime was launched for the taxpayers. The government believed that this system is very easy and the tax fee will be low for individual taxpayers. In the new tax system, taxpayers with an annual income of Rs 5 to 7.5 lakh have to pay 10 % tax. Whereas in the outdated system, 20 % tax has to be paid on this quantity. However, it should be famous that due to the rebate accessible under section 87A in the new or outdated system, individuals incomes up to Rs 5 lakh yearly will not have to pay any tax.
No tax on income of 8.5 lakhs
The Revenue Secretary said that the government had began a new system with the intention of lowering personal income tax, however only few individuals confirmed curiosity in this path. The cause behind this is given that if a particular person is saving even 50 rupees, then he will undertake the same system. Let us inform you that individuals with an annual income of 8-8.5 lakhs using 80C and normal deduction in the nation do not have to pay any tax.
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