Old Income Tax Regime Will Not Be Phased Out Says Revenue Secretary Sanjay Malhotra

Old Income Tax Regime: The government has no intention of abolishing the old tax regime. Revenue Secretary Sanjay Malhotra said that the government has no plans to phase out the old tax regime. However, the government will not hesitate to promote the new income tax regime which is very simple for both corporate tax and personal income tax. He said, this is the reason why the government has made the new income tax regime very attractive. After making the new income tax regime the default scheme, people will be able to decide which is better for them between the old or the new tax regime.

While presenting the budget for the financial year 2023-24, Finance Minister Nirmala Sitharaman had announced that the new income tax regime will be the default tax regime from now on. If any taxpayer wants to file income tax return under the old income tax regime, then he will have to select this while filing the income tax return. That is why it is being speculated whether the government will abolish the old tax regime. But the Revenue Secretary has made it clear that the government has no plans to abolish the old tax regime.

While presenting the budget for 2023-24 on February 1, 2023, Finance Minister Sitharaman announced to make the new income tax regime attractive that now under the new income tax regime, no tax will have to be paid on income up to Rs 7 lakh. Whereas in the old tax system this limit is Rs 5 lakh. Till the new tax system, tax exemption is available on income up to Rs 3 lakh. 5% on slab of Rs 3 to 6 lakh, 10% on slab of Rs 6 to 9 lakh, 15% on slab of Rs 9 to 12 lakh, 20% on slab of Rs 12 to 15 lakh and above Rs 15 lakh 30 percent income tax has to be paid on higher income. But taxpayers whose annual income is up to Rs 7 lakh will not have to pay tax. Whatever tax is being made, the government gives rebate under 87A. To popularize the new income tax regime, it was also decided to provide the benefit of standard deduction of Rs 50,000 to salaried pensioners, which was earlier available only to taxpayers choosing the old tax regime.

In the new income tax regime, taxpayers do not get the benefit of deduction on payment of interest on savings investment or home loan. Whereas under the old tax regime, the investor gets tax exemption on home loan interest under 24B along with investment savings under 80C. Apart from this, taxpayers can also claim tax exemption on premium payment for mediclaim under 80D.

read this also

Jio Financial Stock: Jio Financial’s stock became a rocket, trading at lifetime high with a jump of 15%.