New Tax Regime to Benefit Middle Class; Leave More Money in Their Hands: FM

New Delhi: Finance minister Nirmala Sitharaman on Saturday said the new tax regime will benefit the middle class as it will leave more money in their hands. Talking to reporters after the customary post-Budget address to the central board of the RBI, she said it is not necessary to induce individuals to invest through government schemes but give them an opportunity to make personal decisions regarding investments.

“…The way we allowed for the standard deduction and also the rates which have been fixed, tax rates which have been fixed for different slabs, it has actually left more money in the hands of the people, the taxpayer, the household,” she said. (Also Read: Money Earning Scheme: Invest in THESE SBI Mutual Funds Schemes to get Strong Profit- Check Return Calculator Here)

Sitharaman in her latest Budget proposed to extend the Rs 50,000 standard deduction benefit to persons opting for the new tax regime. “I don’t think it is necessary for the government to even induce any such measures. (Also Read: PM-KISAN: THESE Farmers are not Eligible to get Benefits of Scheme- Check Details)

A person who earns his money and who runs his household is wise enough to know where he has to put his money…So I’ve not discouraged him from doing it nor am I incentivising them to do anything in particular. It’s for him to take a call,” she said.

Under the revamped concessional tax regime, which will be effective from the next fiscal, no tax would be levied on income up to Rs 3 lakh. Income between Rs 3-6 lakh would be taxed at 5 percent; Rs 6-9 lakh at 10 percent, Rs 9-12 lakh at 15 percent, Rs 12-15 lakh at 20 percent and income of Rs 15 lakh and above will be taxed at 30 percent.

However, no tax would be levied on annual income of up to Rs 7 lakh. This measure of the government was purely to reduce the tax burden on the middle class and is aligned to the promise which was made a couple of years ago of simplifying direct taxation, she said.

Answering a question on the Adani Group crisis, the minister said, “Indian regulators are very, very experienced and they are experts in their domain. The regulators are seized of the matter and they are on their toes as always not just now.”