• Notification Date: 11-01-2024
• Notification No: N/A

Union Budget 2024: No Change in Income Tax rebate in Interim Budget

The Interim Budget 2024 will not see any increase in tax rebate under the New Tax Regime, which will be announced on February 1, a senior finance ministry official said. 

Earlier, there were speculations that the personal income tax rebate may be increased from the current Rs 7 lakh to Rs 7.5 lakh in the vote-on-account for the taxpayers who choose the New Tax Regime. 

“There is no such proposal,” the official reported. 

Last year, FM Nirmala Sitharaman increased the threshold for income-tax rebate from Rs 5 lakh to Rs 7 lakh for assessees opting for the new direct tax regime. 

The basic exemption limit was also hiked to Rs 3 lakh from Rs 2.5 lakh earlier. The Centre also introduced a deduction of Rs 15,000 for a family pension.  

In Budget 2023, for salaried individuals, pensioners and family pensioners, the standard deduction clause was introduced under the new tax regime.  

The old tax regime currently provides salaried employees and pensioners with a standard deduction of Rs 50,000. 

However, the Centre is expected to announce an exemption from tax collected at source (TCS) on overseas credit and debit card spending by individuals, for up to Rs 7 lakh per financial year, in the interim budget, another official said. 

The New Tax Regime was introduced with the altered tax slabs and concessional tax rates. It is applicable to all taxpayers, including individuals, Hindu Undivided Families (HUFs), and Association of Persons (AOPs).  

In Budget 2023, the income tax slabs were reduced to six from seven earlier in a bid to make the personal income tax rules easier. 

a. For income up to Rs 3 lakh, there is no tax. 

b. For income of more than Rs 3 lakh up to Rs 6 lakh, it is 5 percent. 

c. Over Rs 6 lakh up to Rs 9 lakh, it is 10 percent. 

d. Over Rs 9 lakh to Rs 12 lakh, it is 15 percent 

e. Over Rs.12 lakh to Rs.15 lakh, it is 20 percent. 

f. Above Rs 15 lakh, it is 30 percent 

The government has made it clear that individuals who choose the New Tax Regime will not be able to avail various exemptions and deductions, including HRA, LTA, 80C, 80D, and more, which are exclusively available under the Old Tax Regime.