Section 115BAC amendments bring major tax relief for Indians in 2025. Introduced via the Finance Act 2025, these changes make the new tax regime more appealing. First, let’s dive into how they help you save more. With inflation at 6.21% in 2024 (RBI), this relief is timely.
Higher Exemption Limit
These amendments raise the basic exemption limit to ₹4 lakh from ₹3 lakh. This means you pay zero tax on income up to ₹4 lakh. For instance, if you earn ₹5 lakh, only ₹1 lakh gets taxed. So, lower-income earners keep more money. This aligns with a 7% wage growth in 2024 (Economic Survey).
Tax Savings Up to ₹1.14 Lakh
Section 115BAC amendments offer big savings—up to ₹1.14 lakh yearly. The new slabs start at 5% for ₹4 lakh to ₹8 lakh and go up to 30% above ₹24 lakh. Besides, this benefits middle-income groups the most. For example, a ₹10 lakh earner saves significantly compared to the old regime. Thus, you get more disposable income.
Fewer Filings for Low Earners
Section 115BAC amendments reduce tax filings at lower levels. ITRs below ₹5 lakh dropped 12% in AY 2024-25 (CBDT). Why? The ₹4 lakh exemption cuts the need to file for many. Meanwhile, 1.5 crore new taxpayers joined in 2024 (NSE). This change eases their burden. For more on taxes, see “Saving vs Investing: Where should you put your money?” on Artho Shots.
A Response to Economic Pressures
Section 115BAC amendments counter global and local challenges. U.S. Federal Reserve rate hikes in 2024 hit the rupee, while India’s inflation rose. Then, these tax cuts boost spending power. Plus, a 15% rise in digital tax filings in 2024 (Income Tax Dept) shows tech-driven compliance. Therefore, the amendments fit today’s economic needs. For details, visit CBDT Updates.
In conclusion, Section 115BAC amendments in 2025 empower Indians with tax relief. Higher exemptions and ₹1.14 lakh savings help millions. Moreover, they ease filing for low earners. Start planning now to benefit. Ready for more? Explore our tax-saving guides today!