In what could a major relief to the middle class people of India, Finance Minister Nirmala Sitaraman spelled out a heartwarming news during the ongoing budget sessions in Parliament. Announcing a new tax regime as part of Budget 2025, she made a loud statement that ‘There will be no tax up to 12 Lakh rupees’ and this received widespread applause from the NDA representatives in the house.

In her address, Nirmala Sitaraman fleshed out the new tax regime structure by saying “I propose to revise tax rate structures as follows: 0 to ₹4 Lakhs – nil, ₹4 Lakhs to ₹8 Lakhs – 5%, ₹8 Lakhs to ₹12 Lakhs – 10%, ₹12 Lakhs to ₹16 Lakhs – 15%, ₹16 Lakhs to ₹20 Lakhs – 20%, ₹20 Lakhs to ₹24 Lakhs – 25% and above ₹24 Lakhs – 30%” .

“To taxpayers up to ₹12 Lakhs of normal income other than special rate income such as capital gains, a tax rebate is being provided in addition to the benefit due to slab rate reduction in such a manner that there is no tax payable by them,” she added.

As this is the first full term budget of Modi’s government after returning to power for the third consecutive term in 2024, there have been a lot of hopes for ease of rates due to the growing resentment in the public over tax terrorism. Finally, the government seems to have paid heed to the concerns of tax payers and announced the big news which will be welcomed by the middle income groups.

Nirmal Sitharaman, who created history by presenting the eight budget in a row, stated that the new Income Tax Bill, to be introduced next week, will be clear, simple to understand and will lead to lower litigation. Finance Minister Nirmala Sitharaman also announced that personal income tax reforms will focus on middle class, with rationalisation of TDS and TCS for simplicity.