Under the revamped new tax regime, the personal income tax rebate limit has been increased to Rs 7 lakh from the previous Rs 5 lakh.

Hours after tabling the Budget 2023-24 in Parliament, Union Finance Minister Nirmala Sitharaman on Wednesday said the central government has made the new tax regime more attractive for taxpayers and insisted that there is no compulsion to migrate to the new system.

Addressing a press conference, Sitharaman said: “We are not compelling anybody. Those who want to remain in the old tax regime can still remain there. But the new one is attractive because it gives a greater rebate. It also provides for simplified and smaller slabs, lower rates of taxation and also slabs which are nicely broken down.”

This year’s Budget has brought in a slew of changes in the optional tax regime, which was introduced in 2020-21. As per the changes, no tax would be levied on people with annual income of up to Rs 7 lakh under the new tax regime. While an individual will have to forego exemptions and deductions on investments in the new tax regime, the finance minister has allowed a standard deduction of Rs 50,000 in it.