EXPLAINED
OLD TAX REGIME VS NEW TAX REGIME
Published By Livemint
| 02 Feb, 2023
Tax rebate
Limit extended to ₹7 lakh p.a. in new regime, remains ₹5 lakh p.a. in old regime
Tax slabs
Tax slabs were reduced to 5 in new tax regime, old one has 3 slabs
Exemption
Limit is increased to ₹3 lakh in the new tax regime, remained ₹2.5 lakh in the old one
New regime’s slab
0-3 lakh-nil, 6-9 lakh-10%, 9-12 lakh-15%, 12-15 lakh-20%, >15 lakh- 30%
Old system’s tax slab
2.5-5 lakh-5%, 5-10 lakh-20%, >10 lakh-30%
87A benefit
The govt has extended 87A benefit from ₹12,500 to ₹25,000 in both regimes
Standard deduction
A standard deduction of ₹50k has been extended to the new tax regime as well
Default system
The new tax regime replaced the old one as the default system
Co-existence
Citizens will also have the option to go with the old tax regime
Big winner
Individuals earning less than ₹7 lakh p.a. are the biggest winner in the new tax regime