Thread by @Abhishe27960014

🚨My Interpretation on Standard Deduction Announcement in Today's Budget🧵

1) Std deduction will still be 50,000 not 52,500

2) In the new regime, it was not previously considered a deduction, but starting this year it will be recognized as deduction.

#Budget #incometaxslabs

3) Let's take one example to understand this.

Consider Gross Salary= 15.5 Lakh

Calculate tax payable under both pre-budget & post-budget scenarios.

Before Budget, you would have paid 202,500 tax.

After budget announcement, you will pay 150,000 tax.

So net gain of 52,500.

4) The increase of the standard deduction from 50,000 to 52,500 was not explicitly mentioned in the budget speech, but it is being interpreted by many as such.

Below is the budget snippet.

5) The net gain of 52,500 mentioned by the FM can be seen by calculating taxes on any salary above 15.5 lakh, both before and after the budget.

Consider, gross salary of 20Lakh. You will see a gain of 52,500 in tax calculation between before and after budget.

I can be completely wrong in my understanding.

This post is to get feedback and clarity.

Here is an article by Moneycontrol:

moneycontrol.com/news/business/…

This is from FM's twitter handle. No mention of increase in Standard Deduction.

https://twitter.com/nsitharamanoffc/status/1620689093213716481