Budget 2021: Income tax slabs unlikely to change

The Centre is unlikely to modify personal income tax slabs during the upcoming Budget for 2021-22 financial year as per reports.

However, the Ministry of Finance is considering granting income tax relief through other measures, the news channel reported.

The current tax slabs are 5 percent for income between Rs 2.5-5 lakh, 20 percent for Rs 5-10 lakh, and 30 percent for higher-income than Rs 10 lakh. The rates are slightly different for individuals who opt for the new tax regime.

The revenue department has proposed greater tax incentives to encourage homebuyers in the affordable housing segment. The finance ministry is also considering requests to increase the limit for exemptions under Section 80C to Rs 2 lakh, from the current Rs 1.5 lakh.

According to the report, the Centre is also evaluating a proposal to raise the deduction limit on health insurance premium under Section 80D beyond the current Rs 25,000 limit. Union Finance Minister Nirmala Sitharaman will present the Budget on February 1, 2021.