The brand new revenue tax regime for submitting returns has been ‘sweetened’ within the Funds 2023-24 and will probably be useful for max variety of taxpayers as they’ll take pleasure in a ‘lowered’ tax price, CBDT Chairman Nitin Gupta stated.
Chatting with PTI throughout a post-Funds interview, Gupta stated the intent of the federal government whereas saying the brand new slabs and charges below the brand new tax regime is to regularly “put off deductions and exemptions” in order that the “long-standing demand of discount of taxes for particular person taxpayers and entities may be met.”
Finance Minister Nirmala Sitharaman, whereas presenting the Funds 2023-24 within the Parliament on Wednesday, stated the federal government has made the brand new revenue tax regime extra engaging for taxpayers and has thus led to “substantial adjustments” in its construction for the advantage of the center class.
“This new regime for people was laid down two years in the past (Funds of 2020-21) however in all probability the advantages weren’t percolating and now the federal government has re-tweaked the slabs, re-tweaked the variety of slabs and charges and the profit is now clearly seen, be it any taxpayer…,” the CBDT Chairman instructed the information company.
He stated an identical measure taken for the company class of taxpayers someday again has been discovered to be useful for them. He didn’t say the variety of particular person taxpayers who opted for the brand new regime over the past two years.
“The brand new regime is actually sweetened… the part of taxpayers who is not going to be benefitting will probably be a really miniscule part which is taking all types of advantages when it comes to the curiosity in home property, the deductions below part VIA amongst others and solely these kind of taxpayers could possibly be impacted when it comes to they might be higher off within the previous regime.”
“Barring that, the brand new regime can be useful to everybody,” Gupta stated.
The Central Board of Direct Taxes is the executive physique for the Earnings-tax division.
The CBDT chief stated that the federal government went into numerous elements of the brand new tax regime, bettered it and subsequently within the newest Funds, a “parity” of types has been achieved between the 2 schemes.
“There are about 3.5 crore salaried taxpayers in India and each salaried taxpayer will probably be at par with the previous regime in the event that they go for the brand new regime as a result of customary deduction has been made out there within the new regime…so when it comes to parity it has been established.”
“With the lowered variety of slabs and wider slabs, the profit will probably be percolating to everybody now and the lengthy standing demand of discount of taxes will probably be met,” he stated.
Requested if the Finance Minister’s declaration that the brand new tax regime will probably be a default tax choice will have an effect on the customers of previous regime in any approach, the CBDT Chairman stated the taxpayers can have full independence to decide on any one of many tax submitting programs and none of them will probably be at any loss together with the power to reverting to the previous scheme.
“The brand new regime is the default scheme within the sense that what is going to come up on the display screen (on the e-filing portal) would be the new regime however the choice is undamaged and the taxpayer can shift between the regimes…”
“There isn’t any disincentive for any part of taxpayers and so they can go for the regime which they wish to,” he stated.
Gupta stated an internet calculator will even be supplied to the taxpayers, like earlier than over the e-filing portal, to match their tax liabilities below the 2 regimes.
As per the adjustments proposed within the Funds, no tax can be levied on individuals with annual revenue of as much as Rs 7 lakh below the brand new tax regime however it made no adjustments for many who proceed within the previous regime that gives for tax exemptions and deductions on investments and bills akin to HRA.
Beneath the revamped new tax regime, no tax can be levied for revenue as much as Rs 3 lakh. Earnings between Rs 3-6 lakh can be taxed at 5 per cent; Rs 6-9 lakh at 10 per cent, Rs 9-12 lakh at 15 per cent, Rs 12-15 lakh at 20 per cent and revenue of Rs 15 lakh and above will probably be taxed at 30 per cent.
“It will present main aid to all taxpayers within the new regime,” Sitharaman stated in her Funds speech.
A person with an annual revenue of Rs 9 lakh will probably be required to pay solely Rs 45,000. That is solely 5 per cent of his or her revenue. It’s a discount of 25 per cent on what she or he is required to pay now (within the previous regime) — Rs 60,000, she stated.
“Equally, a person with an revenue of Rs 15 lakh can be required to pay solely Rs 1.5 lakh or 10 per cent of his or her revenue, a discount of 20 per cent from the prevailing legal responsibility of Rs 1,87,500,” Sitharaman stated.
The minister later instructed reporters throughout a press convention on Wednesday that the federal government needs to make the brand new tax regime engaging sufficient and compliance shouldn’t be burdensome on taxpayers. Nonetheless, if somebody feels the previous regime is extra useful, he/she will proceed in it.
“The final word curiosity is to make the less complicated (new) regime extra engaging,” she stated.