FY 20-21 allows a taxpayer to pay tax by choosing any of the two tax states, the Old Tax Empire or the New Tax. The new tax regime gives a person the freedom to continue with the old tax regime if he wants to. When choosing a new tax regime, the taxpayer will be required to waive certain reductions and exemptions granted to the old tax regime that will be obtained if the old tax regime is elected to continue. one under Section 80CCD (2). This means that the employer's contribution to the National Pension Scheme is deducted from the annual salary. Under the old and new states, you can deduct Rs 2,50,000 from your gross salary to your income tax as the basic exemption applies to both states.