Budget 2024 Live: What Was Announced for Personal Income Tax and the Salary Benefits for Working Professionals

Nirmala Sitharaman, Union Finance Minister, Government of India is presenting the Union Budget 2024 live in the Parliament. In her last Budget 2024 announcement prior to the Lok Sabha elections 2024, Sitharaman unveiled significant changes to the personal income tax structure in India. The minister declared an increase in the tax rebate to 7 lakhs, ensuring individuals with an annual income at this level won't be liable to pay any tax. In a move aimed at simplification, she proposed reducing the number of income slabs from 6 to 4 lakhs and increasing the tax exemption limit to 3 lakhs.

How the New Budget 2024 Aims to Benefits Salaried Professionals

According to the proposed structure in the Budget 2024 live announcements, under the new tax structure, the following announcements have been made:

The rates are set at 0% for income up to 3 lakhs.

• 5% for 3 to 6 lakhs.
• 10% for 6 to 9 lakhs.
• 15% for 9 to 12 lakhs. 
• For incomes above 12 lakhs, the rates are 20% up to 15 lakhs and 30% beyond 15 lakhs.

This adjustment is expected to bring considerable relief to taxpayers, with individuals earning nine lakhs now required to pay only ₹45,000, marking a 25% reduction from the previous obligation of ₹60,000.

The Finance Minister highlighted that this restructuring would significantly benefit the middle class, offering relief to those with annual incomes of Rs 15 lakhs or more, who stand to gain ₹52,500. In another key announcement, Sitharaman proposed a reduction in the highest surcharge rate from 37% to 25%, effectively lowering the maximum tax rate to 39%.

Furthermore, the Budget addresses the outdated tax exemption limit on leave encashment for non-government salaried employees, which was set in 2002, increasing it from three lakh rupees to 25,00,00 rupees. The new income tax regime is set to become the default, although citizens will retain the option to choose the old tax regime.

In addition to these changes, the Budget includes various other amendments detailed in the Annex, aiming to generate additional revenue of about 38,000 crore to 37,000 crore in direct taxes and ₹1000 crore in indirect taxes annually. Overall, the proposed adjustments are anticipated to mobilize approximately 35,000 crores in total revenue each year.