Standard Deduction Budget 2024: Finance Minister Nirmala Sitharaman has announced an increase in the standard deduction for salaried employees by ₹25,000 in the new tax regime while presenting Budget 2024-25 in the Lok Sabha on Tuesday, July 23. The standard deduction has been increased to ₹75,000. It will apply to those who opt for the new tax regime.
“For those opting for the new tax regime, the standard deduction for salaried employees to be increased from ₹50,000 to ₹75,000,” Nirmala Sitharaman announced. It was anticipated that the Finance Minister would increase the standard deduction to ₹1 lakh in the new tax regime.
However, the deduction will stay unchanged at ₹50,000 under the old tax regime. According to Nirmala Sitharaman, for family pensioners, the deduction will increase from ₹15,000 to ₹25,000 under the new regime.
The revised slabs are as follows:
As a result, Nirmala Sitharaman stated that those choosing the new regime would save ₹17,500. Additionally, the Finance Minister unveiled plans for a thorough overhaul of the Income Tax Act of 1961 to enhance readability, reduce uncertainty, and minimize the potential for litigation.
Nirmala Sitharaman pledged to streamline the tax system for individual income taxpayers, aligning with previous efforts. She reaffirmed the government's commitment to simplifying tax regulations and structures, noting that over two-thirds of personal taxpayers had opted for the new tax regime in the fiscal year 2023-24.
