Lok Sabha Question No. 1546 (UNSTARRED), answered on 2026-02-09
Subject: Beneficiaries of Income Tax Limit Hike
Ministry: FINANCE
Asked by: Dr. Manna Lal Rawat

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION NO. 1546

TO BE ANSWERED ON MONDAY, FEBRUARY 9, 2026/ MAGHA 20, 1947 (SAKA)

## BENEFICIARIES OF INCOME TAX LIMIT HIKE

## 1546. DR. MANNA LAL RAWAT:

Will the Minister of FINANCE be pleased to state:

- (a)  whether the Government has increased the income tax exemption limit in the current financial year;
- (b) if so, the details thereof along with the new limit and the effective date; and
- (c) the estimated number of taxpayers likely to be benefited from the increase in the income tax limit along with its excepted impact on the Government's revenue?

## ANSWER

THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

(a) & (b) The income-tax slabs and rates were revised and considerably made liberal by the  Finance  Act,  2025  and  they  apply  in  respect  of  any  income  for  FY  2025-26  and subsequent financial years for all taxpayers filing Income Tax Returns under the new tax regime as per section 115BAC(1A) of the Income-tax Act, 1961 (the Act).

Finance Act, 2025 has increased the rebate for the resident individual under the new regime so that they do not pay tax if their total income is up to ₹ 12,00,000. Marginal relief as provided earlier under the new tax regime is also applicable for income marginally higher than ₹ 12,00,000.

For salaried individuals, standard deduction of ₹ 75,000 is available. Therefore, salaried individuals do not pay tax if their gross total income is up to ₹ 12,75,000.

The details of the slab rates are as follow and apply for AY 2026-27 and onwards:

| Total Income (in ₹)         | Rate of tax u/s 115BAC of the Act for AY 2026-27 onwards (%)   |
|-----------------------------|----------------------------------------------------------------|
| Up to 4,00,000              | Nil                                                            |
| From 4,00,001 to 8,00,000   | 5                                                              |
| From 8,00,001 to 12,00,000  | 10                                                             |
| From 12,00,001 to 16,00,000 | 15                                                             |
| From 16,00,001 to 20,00,000 | 20                                                             |
| From 20,00,001 to 24,00,000 | 25                                                             |
| Above 24,00,000             | 30                                                             |

The aforesaid slab structure applies to all individuals. Full Rebate is allowed upto an extent of ₹ 12 lakhs to resident individual. Marginal relief is provided on total income upto ₹ 12,70,588. Thereafter, taxes computed as per the above slabs shall be pa yable in full.

(c) As slab rates have been modified along with rebate on total income, all taxpayers filing Income Tax Returns in the new tax regime and having income more than seven lakh rupees during the financial year 2025-26 are likely to be benefitted from the increase in the incometax limit. Further, revenue of about ₹ 1 lakh crore in direct taxes would be foregone.

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