“We are not forcing anyone to switch from the old regime to the new regime,” Seetha Raman said, speaking with Rahul Joshi, Group Editor-in-Chief, Network 18, at the News18 India Chopal event. He noted that more than 78 percent of taxpayers have migrated to the new tax system, which was introduced to streamline direct taxation and ease compliance.
Under the new regime, tax rates have been kept low and the standard deduction has been raised to ₹75,000 to reduce the tax burden on the middle class. No change has been made in the old tax regime with respect to standard deduction.
“We brought standard deductions in the new tax system after we heard what people wanted,” Seetha Raman said. Therefore, the tax rates have been reduced.”
Despite these changes, Seetha Raman admitted that some middle-class people believed that the rate cut in the new scheme should also apply to the old regime. “I understand that some middle-class people feel that the rate cut in the new scheme should also apply to the old regime,” she said.
The Finance Minister emphasized that the income tax slab system is applicable to everyone including the middle class. Reiterating the government's commitment to making the tax system more navigable, he explained, “The effort has been to simplify direct taxation.”
Also Read: New vs Old Income Tax System: Which Is Better for You After Budget 2024 Changes? Calculate here