File photo of Union Finance Minister Nirmala Sitharaman with Central Board of Direct Taxes Chairman Nitin Gupta | Photo Credit: Vedan M
new income tax regime has been “mellowed” for the purpose of filing return Budget 2023-24 CBDT chairman Nitin Gupta said it would be beneficial for maximum number of taxpayers as they can enjoy “lower” tax rate.
talking to PTI During a post-Budget interview, Gupta said that while announcing the new slabs and rates under the new tax regime, the government’s intention is to gradually “do away with deductions and exemptions” so that “tax cuts are long overdue”. Ongoing demand “can be met by individual taxpayers and institutions.”
Presenting the Budget 2023-24 in Parliament on Wednesday, Finance Minister Nirmala Sitharaman said the government has made the new income tax regime more attractive to taxpayers and thus made “substantial changes” in its structure for the benefit of the middle class. Are. Class.
“This new regime for individuals was prescribed two years ago (2020-21 budget) but perhaps the benefits were not trickling down and now the government has again changed the slabs, renumbering the slabs and rates. changed and the benefit is now clearly visible, irrespective of the tax payer…” the CBDT chairman told the news agency.
He said that sometime back a similar measure for the corporate category of taxpayers has been found beneficial for them. He did not say how many individual taxpayers have opted for the new regime in the last two years.
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“The new dispensation is sweet indeed… The section of taxpayers who would not be benefitted would be a very small section who are enjoying all kinds of benefits in respect of interest on house property, deduction under section VIA inter alia And only these types of taxpayers may be affected because they would have been better off under the old regime.”
“Barring that, the new regime will be beneficial for all,” Mr Gupta said.
The Central Board of Direct Taxes (CBDT) is the administrative body for the Income Tax Department.
The CBDT chief said the government looked into various aspects of the new tax regime, fine-tuned it and hence a kind of parity between the two schemes has been achieved in the latest budget.
“There are about 3.5 crore salaried tax payers in India and every salaried tax payer if they opt for the new regime they will be at par with the old regime as standard deduction has been provided in the new regime…so in terms of parity it has been established. ”
“With lesser number of slabs and wider slabs, now everyone will be benefited and the long standing demand of reduction in taxes will be fulfilled,” he added.
Taxpayers have the freedom to choose
Asked whether the Finance Minister’s announcement that the new tax regime would be a “default” tax option would affect the users of the old regime in any way, the CBDT Chairman said that taxpayers should be given the option of choosing one of the tax filing systems. will have complete freedom and none of them will be at any disadvantage including the facility to revert to the old scheme.
“The new regime is the default scheme in the sense that what appears on the screen (on the e-filing portal) will be the new regime but the option remains and the taxpayer can switch between regimes…”
“There is no disincentive for any section of taxpayers and they can choose the regime of their choice,” he added.
Shri Gupta said that an ‘online calculator’ will also be made available to taxpayers as before on the e-filing portal to compare tax liabilities under the two regimes.
tax slab
As per the changes proposed in the budget, no tax will be levied on people with an annual income of up to Rs 7 lakh under the new tax regime, but no changes have been made for those who continue in the old regime to avail tax exemptions and deductions. provide. On investments and expenses like HRA.
Under the revised new tax regime, no tax will be levied on income up to Rs 3 lakh. Income between ₹3-6 lakh will be taxed at 5%; ₹6-9 lakh will be taxed at 10%, ₹9-12 lakh at 15%, ₹12-15 lakh at 20% and ₹15 lakh and above at 30%.
“This will bring great relief to all taxpayers in the new regime,” Sitharaman said in her budget speech.
A person with an annual income of Rs 9 lakh will have to pay only Rs 45,000. This is only 5% of his income. She said that this is a reduction of 25% on the amount required to be paid now (in the old regime) – 60,000.
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“Similarly, a person with an income of ₹15 lakh would need to pay only ₹1.5 lakh or 10% of his income, a reduction of 20% from the current liability of ₹1,87,500,” Sitharaman said.
The minister later told reporters during a press conference on Wednesday that the government wanted to make the new tax regime attractive enough and that there should not be a compliance burden on taxpayers. However, if one feels that the old system is more beneficial, one can continue in it.
“It is in the ultimate interest to make the simpler (new) regime more attractive,” he said.