No Tax Reductions in Old Regime, Confirms Finance Minister Nirmala Sitharaman
By: Admin | September 18, 2024 | Categories: Tax Policy | 3 Min Read
Finance Minister Nirmala Sitharaman recently clarified that there will be no reduction in tax rates under the old tax regime, despite rising calls for uniform rate cuts across both the old and new systems. Speaking at an event, Sitharaman emphasized that while the new tax regime was introduced to offer simplified rates and processes, it remains an optional choice, not mandatory.
She highlighted that the new system offers lower tax rates and an increased standard deduction of ₹75,000, designed to alleviate the tax burden on middle-class taxpayers. However, these benefits are exclusive to the new regime and will not be extended to the old system.
Key Points:
- The new regime simplifies tax compliance and offers additional benefits, but taxpayers can still opt for the old regime if they prefer.
- The government’s focus remains on streamlining direct taxes and making the system more accessible, particularly for the middle class.
- Changes, such as the standard deduction in the new regime, reflect the government’s responsiveness to public concerns, but tax rate reductions will only apply to the new regime.
The Finance Minister reiterated that while the government encourages voluntary adoption of the new tax regime, the choice remains with the taxpayer, with no compulsion to switch.
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