Finance Minister Nirmala Sitharaman on Sunday, February 1, proposed to increase the time limit for filing revised income tax returns (ITR), however, no changes were made to income tax (IT) rates and slabs.
The government also proposed a reduction in the TCS rate for pursuing education and medical education under the liberalised remittance scheme.
IT rates, slabs
The tax rates under the new tax regime, which is the default tax regime for Individuals, HUF, Association of Persons (AOP)/Body of Individuals (BOI), and Artificial Juridical Persons (AJP), are as under:
| Net Income Range | Tax rate |
| Upto Rs. 4,00,000 | Nil |
| From Rs. 4,00,001 to Rs. 8,00,000 | 5% |
| From Rs. 8,00,001 to Rs. 12,00,000 | 10% |
| From Rs. 12,00,001 to Rs. 16,00,000 | 15% |
| From Rs. 16,00,001 to Rs. 20,00,000 | 20% |
| From Rs. 20,00,001 to Rs. 24,00,000 | 25% |
| Above Rs. 24,00,000 | 30% |
However, for AY 2026-27, a maximum rebate of Rs. 60,000 is allowed under Section 87A, if the total income of an individual is chargeable to tax under Section 115BAC(1A) and the total income does not exceed Rs. 12,00,000.
Time limit for filing revised ITR
Though the minister did not change the IT rates and slabs, the time limit for filing revised ITR has been increased from December 31 to March 31, on payment of a nominal fee.
The government also proposed a reduction in the TCS rate for pursuing education and medical education under the liberalised remittance scheme from 5 per cent to 2 per cent.
The Tax Collected at Source (TCS) rate on the sale of overseas tour packages was announced to be cut to 2 per cent from 5 per cent. The rate was 20 per cent earlier.
In her Budget speech, Sitharaman announced a proposal to exempt awards given by the Motor Accident Claims Tribunal from income tax.
