FM income tax googly for the middle class

Budget 2023 has done something substantial for the middle class that has been chafing at the bit a while, over the lack of any sizeable reduction in its income-tax burden.

- S MURLIDHARAN

In the assessment year 2023-'24 i.e., for financial year 2023-24, those with an income of up to Rs 7 lakh need not pay any income tax. This is up Rs 2 lakh from the earlier slab of Rs 5 lakh being insulated from tax. For those with income in excess of Rs 7 lakh too, there is relief, with the tax-free threshold going up to Rs 3 lakh, from the previous Rs 2.5 lakh. The tax rates for income in excess of Rs 3 lakh have been cut and successive slab progressions are less steep. For AY 2022-23, the rates were 5 per cent on income between Rs 2.50 lakh and Rs 5 lakh, 20 per cent on income between Rs 5 lakh and Rs 10 lakh and 30 per cent on income in excess of Rs 10 lakh. In AY 2023-'24, it is going to be less steep. Tax on Rs 0-3 lakh income is nil. Incomes between Rs 3 lakh and up to Rs 6 lakh will be taxed at 5 per cent; income between Rs 6 lakh and up to Rs 9 lakh will be taxed at 10 per cent; income between Rs 9 lakh and Rs 12 lakh, will be taxed at 15 per cent; income between Rs 12 lakh and up to Rs 15 lakh will be taxed at 20 per cent, whle income above Rs 15 lakh will be taxed at 30 per cent.