As per the Union Budget 2025-26, what is the income limit up to which no personal income tax is applicable under the new tax regime?
- AOption (a)
₹10 lakh
- BOption (b)
₹12 lakh
- COption (c)
₹15 lakh
- DOption (d)
₹20 lakh
View answer & explanationHide answer & explanation
Correct answer
₹12 lakh
Why this answer is correct
The correct answer is ₹12 lakh.
In News
- The Union Budget 2025-26 has introduced major reforms in the income tax structure under the new tax regime.
Key Points
- The new tax structure aims to provide relief to the middle class by reducing tax liability and increasing disposable income.
- The revised tax structure provides a zero-tax slab up to ₹12 lakh for all taxpayers.
- For salaried taxpayers with a standard deduction of ₹75,000, the effective exemption extends up to ₹12.75 lakh.
- New income tax slabs under the revised regime:
- 0 - 4 lakh rupees: Nil
- 4 - 8 lakh rupees: 5%
- 8 - 12 lakh rupees: 10%
- 12 - 16 lakh rupees: 15%
- 16 - 20 lakh rupees: 20%
- 20 - 24 lakh rupees: 25%
- Above 24 lakh rupees: 30%
- The aim is to boost household consumption, savings, and investment.
Additional Information
- Union Budget
- A budget is an elaborate statement of the expenditure and income of the government for the given financial year, which begins on April 1 and ends on March 31.
- The Constitution uses the term Annual Financial Statement instead of "Budget," as enshrined under Article 112 of the Constitution.
- New vs. Old Tax Regime
- The old tax regime includes exemptions and deductions like HRA, LTA, and 80C benefits.
- The new tax regime offers lower tax rates but eliminates most exemptions.
- Standard Deduction
- Employees and pensioners get a standard deduction of ₹75,000 under the new regime.
- This increases the effective exemption to ₹12.75 lakh for salaried individuals.