Alternate income tax regime for Indians

Budget 2020 has given Indian taxpayers with an annual income of upto Rs 15 lakh an option to go for a lower tax slab in lieu of foregoing income tax exemptions. In the new regoime, 70 tax exemptions will be removed. In return, income between Rs 5 lakh and Rs 7.5 lakh will be taxed at 10% down from current 20%, income between Rs 7.5 lakh and Rs 10 lakh will be taxed at 15% down from current 20%, and income between Rs 10 lakh and Rs 12.5 lakh will be taxed at 20% down from current 30%. Income between Rs 12.5 lakh and Rs 15 lakh will be taxed at 25% down from current 30%. Incomes above Rs 15 lakh in a financial year will continue to be taxed at 30%. The choice will depend on an individual’s income composition and investments being made.