Budget 2021 | Income Tax relief up to Rs 80,000 in total tax liability likely: Report

Union Budget 2021 could bring a sigh of relief to income tax payers to the extent of Rs 50,000 to Rs 80,000 on the total tax liability, discussions among top officials indicate.

According to a Moneycontrol report, slabs under the new tax regime could change and deductions under the old regime could be raised.

Sources told the publication that the Centre is looking to up the standard deduction under the old regime, currently Rs 50,000, along with some tax relief on housing loans.

Under the new tax regime, people with an annual income of Rs 5 lakh to Rs 7.5 lakh have to pay a reduced tax rate of 10 per cent; those with income between Rs 7.5 lakh and Rs 10 lakh pay 15 per cent; those who earn between Rs 10 lakh and 12.5 lakh are taxed 20 per cent; those who make between Rs 12.5 lakh and 15 lakh are taxed 25 per cent; and those earning above Rs 15 lakh 30 per cent

Union Finance Minister Nirmala Sitharaman had announced that the new tax regime was optional and the taxpayers had the choice to either remain in the old regime with exemptions and deductions or opt for the new reduced tax rate without those exemptions.

About 70 tax exemptions and deductions were removed in the new 'simplified' tax regime when the finance minister had announced it.