Income Tax Announcement : Finance Minister Nirmala Sitharaman has made a big announcement regarding income tax. No tax will be levied up to Rs 12 lakh. Income tax rates in India vary over time according to economic growth and population requirements. The increase or decrease in these rates has a direct impact on the general public, making it necessary to ensure that the tax system is fair to all classes.
1997-98: The first major increase
In 1997, the then Finance Minister P. Chidambaram has made significant changes in income tax rates. This year, income above Rs 5 lakh was taxed at 40%, the highest level at the time.
2009-10: Inclusion of surcharge
In the financial year 2009-10, the government had eliminated the surcharge on personal income tax. However, later in 2010-11, a 10% surcharge was levied on income above Rs 10 lakh.
2014-15: New tax regime
In 2014, the Narendra Modi government introduced a new tax regime. This year, some changes were made in the income tax slabs. There was no tax on income up to Rs 2.5 lakh, but 10% was levied on income from Rs 2.5 lakh to Rs 5 lakh and 20% on income upto Rs 5 lakh to Rs 10 lakh.
2018-19: Health and Education Cess
In 2018, the government increased the health and education cess to 4%. This put an additional financial burden on the upper income bracket. In addition, new tax slabs have also been implemented from this year.
2020-21: Effects of COVID-19
During the COVID-19 pandemic, the government suspended some taxes as part of the relief measures, but despite this, tax rates for the higher income group remained stable.
2021-22: Endeavour of stability
This year too, the government kept tax rates stable. However, tax rates for the higher income group were increased under some specific provisions.
What was so far (2024-25)
Currently, there is no tax up to Rs 3 lakh in the new tax regime. At the same time, income of 3 to 7 lakh is currently taxed at 5 per cent. At the same time, 10 per cent tax has to be paid on income of Rs 7 to 10 lakh. Currently, income between Rs 10 and Rs 12 lakh is taxed at 15 per cent .