Summary of "BIG RELIEF! No Income Tax Up to ₹12 Lakh | Union Budget 2025 Highlights"
In the Union Budget 2025 announcement, it was revealed that individuals earning up to ₹12 lakh will not be required to pay income tax. This change is aimed at benefiting the middle class, allowing them to retain more of their earnings, which is expected to enhance household consumption, savings, and investments.
New tax structure
The new tax structure includes several revised tax slabs:
- Income up to ₹4 lakh: 0% tax
- ₹4 lakh to ₹8 lakh: 5% tax
- ₹8 lakh to ₹12 lakh: 10% tax
- ₹12 lakh to ₹16 lakh: 15% tax
- ₹16 lakh to ₹20 lakh: 20% tax
- ₹20 lakh to ₹24 lakh: 25% tax
- Above ₹24 lakh: 30% tax
For taxpayers earning up to ₹12 lakh, additional rebates will ensure that they pay no tax, effectively providing a complete tax exemption at this income level. Examples illustrate that a taxpayer with a ₹12 lakh income will benefit by ₹80,000 in tax savings, while those with ₹18 lakh and ₹25 lakh incomes will see benefits of ₹70,000 and ₹1,10,000 respectively.
Overall, these tax proposals are expected to result in a revenue loss of approximately ₹1 lakh crore in direct taxes and ₹2,600 crores in indirect taxes.
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