In a historic move, the Interim Finance Minister Piyush Goyal has announced that no income tax will have to be paid by an individual with income up to Rs 5 lakh. In effect, an individual earning a gross salary of Rs 6.5 lakh per annum will not have to pay any tax if he/she invested in specified tax saving schemes (the deducations have already been increased to Rs. 1.5 lakh by the NDA government).
As the government fulfilled the long pending demand of exemption of Rs. 5 Lakh in income tax, let’s recall how the NDA government has brought relief in income tax liabilities for the salaried or middle-class individual taxpayers in last 5 years.
How the relief reached the Salaried Class
If an individual (or salaried employee) with a taxable income of Rs. 8 Lakh calculates the tax outgo for himself under both UPA and NDA government till the last budget. Here it is.
(Disclaimer: Above calculation is based on assumptions. The actual tax amount may vary depending upon various other individual specific factors.)