This time the central government is doing big planning regarding Income Tax. Finance Minister Nirmala Sitharaman will present the Budget 2023 on February 1, 2023, and this year a plan is being made to make major changes regarding tax, which is expected to provide great relief to taxpayers. If you also pay tax or come in the tax slab, then it is important for you to know what kind of changes the Central Government is going to make in the tax rates this time.

What is the opinion of the expert?

Many experts believe that the government can make changes in the tax slab in many ways. At the same time, many people believe that the rates and slabs of income tax will remain applicable which were implemented in the assessment year 2022-23.

What kind of tax exemption will be available?

Let us tell you that at present 2 types of arrangements are applicable in the country. You can choose according to yourself whether you have to pay tax in the new regime or in the old regime… but this time what kind of tax relief will the government give to the general public. It is very important to see this.

Income Tax Slabs and Rates 2023 (New Regime)

>> On annual income up to Rs 2.5 lakh – Zero tax
>> On annual income up to Rs 2.5-5 lakh – 5% tax
>> Annual income up to Rs 5-7.5 lakh On – 10% tax
>> On annual income up to Rs 7.50-10 lakh – 15% tax
>> On annual income up to Rs 10-12.5 lakh – 20% tax
>> On annual income up to Rs 12.5-15 lakh – 25% tax
>> 30% tax on annual income up to Rs 15-20 lakh >> 30% tax
on annual income above Rs 20 lakh

Income Tax Slabs and Rates 2023 (Old Regime)

>> On annual income up to Rs 2.5 lakh – Zero tax
>> On annual income up to Rs 2.5-5 lakh – 5% tax
>> Annual income up to Rs 5-10 lakh On – 20% tax
>> On annual income up to Rs 10-20 lakh – 30% tax
>> On annual income above Rs 20 lakh – 30% tax

The rate of 30 percent will be reduced to 25 percent , every year some special provisions are made in the budget by the government to give great relief to the income tax payers. This time the government is planning to make a major revision in the rates of income tax, after which tax payers will get a big relief. It is believed that the government can reduce the maximum rate of 30 percent to 25 percent and increase the maximum tax limit to 20 lakhs.

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At the same time, many people are also saying that the income tax rates and slabs which were applicable in the assessment year 2022-23, can remain applicable in the new assessment year (AY 2023-24) as well.

Let us tell you that at present two tax systems are in force in the country. You can choose any of these according to your convenience. Now it has to be seen what changes will happen next year.

Income Tax Slabs and Rates 2023 (New Regime)

On annual income up to Rs 2.5 lakh: Zero On annual income
up to Rs 2.5-5 lakh: 5% On
annual income up to Rs 5-7.5 lakh: 10%
7.50-10 lakh Annual income up to Rs.15 lakhs: 15%
Annual income up to Rs.10-12.5 lakhs: 20%
Annual income up to Rs.12.5-15 lakhs: 25% Annual income up to Rs.15-20 lakhs
: 30%
20 lakhs On annual income above Rs.: 30%

Income Tax Slabs and Rates 2023 (Old Regime)

On annual income up to Rs 2.5 lakh: Zero On annual income
up to Rs 2.5-5 lakh: 5% On
annual income up to Rs 5-10 lakh: 20%
10-20 lakh Annual income up to Rs. 30%
Annual income above Rs. 20 lakhs: 30%

Changes in income tax rates and slabs expected in Budget 2023

Several tax experts and industry bodies have urged the government to revise income tax rates in certain slabs to provide relief to taxpayers. The tax rate for individuals has not been changed since FY 2017-18 (new tax regime in FY 2020-21). Experts are expecting that to give some relief to the employed taxpayers, the top tax rate of 30 per cent should be reduced to 25 per cent and the top tax limit should be increased from Rs 10 lakh to Rs 20 lakh.

Tapti Ghosh, partner, Deloitte India, expects from the budget:

Income Tax Rates (Old Regime)
Annual income up to Rs 2.5 lakh: Nil Annual income
up to Rs 2.5-5 lakh: 5% Annual income
up to Rs 5-10 lakh: 20%
Annual income up to Rs 10-20 lakh: 20%
Annual income above Rs 20 lakh: 25%

Income Tax Rates 2023 (New Regime)

Annual income up to Rs 2.5 lakh: Nil Annual income
up to Rs 2.5-5 lakh: 5% Annual income up to Rs 5-7.5 lakh
: 10%
Annual income up to Rs 7.50-10 lakh : 15%
Annual income up to Rs 10-12.5 lakhs: 20% Annual income
up to Rs 12.5-15 lakhs: 20% Annual income
up to Rs 15-20 lakhs: 20%
Annual income above Rs 20 lakhs: 25%

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