On Sunday, after presenting Budget, Finance minister said that the individuals with gross salary income of ₹13 lakh or more and non-salaried persons with income of ₹9.5 lakh or more will get to make tax savings if they sign up for the new lower income tax rate scheme announced in union budget for FY21.
The ministry has made an impact analysis of the new tax regime they have proposed in the case of salaried people who avail themselves of tax deductions of ₹2 lakh and non-salaried individuals of ₹1.5 lakh, who account for about 92% of the 5.79 crore income tax return filers in the country.
As per this scheme, it will offer a tax saving of ₹5,200 to a salaried individual earning ₹13 lakh, However, a person with ₹14 lakh salary will make a saving of ₹10,400 and anyone with a salaried income of ₹15 lakh and above will save ₹15,600.
In the case of non-salaried individuals with ₹9.5 lakh income, they will save 5,200. Those with income between ₹10.5-14.5 lakh, their savings will go from ₹7,800 to ₹28,600. Individuals having income ₹15.5 lakh or more in this class, will save RS 31,200, as per the analysis.
“There are a large number of people, who, for various reasons, are not able to spare money from their income to invest in the various saving instruments such as provident fund, pension schemes, interest on house loans, insurance etc. and therefore are unable to take full advantage of all deductions. Therefore they end up paying more tax in the old regime vis a vis the new one,” said the official, adding that in the proposed low tax regime, such people will be gainers.