- Individual taxpayers having annual income upto 5 lakhs will get full tax rebate.
This means that individuals with gross income up to 7.5 lakh rupees will not need to pay any tax if they make investments in provident funds, NPS and prescribed equities.
7.5 lakhs - 50k standard deduction - 1.5 lakhs in 80C - additional 50k in NPS = 5 lakhs => zero tax.
You can watch the announcement here.
Note: No tax upto total taxable income of Rs 5 lakh is in the form of rebate under section 87A which means that it will be available only to those individuals whose Total Taxable Income is less than or equal to 5 lakhs (after all available deductions eg 80C etc.)
There is no change in tax slabs and there is no exemption to those individuals whose total taxable income (after all deductions) is more than 5 lakhs.
Standard deduction raised from Rs 40,000 to Rs 50,000.
TDS threshold on interest on post office and bank deposits raised from Rs 10,000 to Rs 40,000 (however the tax liability remains the same).
To be updated soon with more details.
Read the Finance Bill 2019 here.