New Tax Regime vs Old Tax Regime: In a major relief for India's middle class, Finance Minister Nirmala Sitharaman unveiled sweeping changes to the new income tax regime during the Union Budget 2025 presentation. Effective from April 1, 2025 (FY 2025-26, AY 2026-27), the regime remains the default for all taxpayers, with widened slabs, lower rates, and a boosted rebate designed to put more money in people's pockets. Advertisement

The headline change? The tax rebate was hiked to Rs 60,000, wiping out liability for resident individuals earning up to Rs 12 lakh in taxable income. Salaried workers and pensioners get an enhanced standard deduction of Rs 75,000, pushing the effective tax-free gross salary threshold to Rs 12.75 lakh. This progressive tweak targets urban millennials and families

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