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FM proposes changes in tax structure; increases tax exemption limit to Rs 3 lakh

Updated: Feb 01, 2023 07:18:22am
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FM proposes changes in tax structure; increases tax exemption limit to Rs 3 lakh

New Delhi, Feb 1 (KNN) Income tax rebate limit has been increased from Rs 5 lakh to Rs 7 lakh, announced the Union Finance Minister Nirmala Sitharaman on Wednesday.

She has proposed a new tax regime by reducing the number of slabs to 5 and increasing the tax exemption limit to Rs 3 lakh.

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“I introduced in 2020, the new personal income tax regime with 6 income slabs, starting from Rs 2.5 lakh. I propose to change the tax structure in this regime by reducing the number of slabs to 5 and increasing the tax exemption limit to Rs 3 lakh,” she said.

She also reduced the number of slabs to 5, which will be nill for Rs 0-3 lakh; 5 per cent for Rs 3-6 lakh; 10 per cent for Rs 6-9 lakh; 15 per cent for Rs 9-12 lakh; 20 per cent Rs 12-15 lakh and 30 per cent for Rs 15 lakh above.

For big earners, the highest effective tax rate has been reduced from 42.7 per cent to 39 per cent.  (KNN Bureau)

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