Finance Minister Nirmala Sitharaman has left income tax slabs unchanged in the Union Budget 2025–26, offering stability rather than fresh relief to salaried taxpayers. The “nil tax” threshold of ₹12 lakh under the new tax regime continues, with salaried individuals effectively enjoying a tax-free income of up to ₹12.75 lakh after the standard deduction.
Finance Minister Ms Sitharaman has not revised income tax slabs for individuals, maintaining the structure announced earlier.
Middle Class at the Centre
Describing the middle class as a key driver of India’s economic growth, the Finance Minister said in her Budget speech that “Democracy, Demography and Demand” are the pillars of India’s journey towards Viksit Bharat. She said the government has consistently backed the middle class by periodically easing their tax burden.
Tracing the evolution of tax relief, Sitharaman noted that the nil-tax slab was raised from ₹2.5 lakh in 2014 to ₹5 lakh in 2019 and ₹7 lakh in 2023. “This reflects our government’s trust in middle-class taxpayers,” she said, adding that no income tax will be payable on income up to ₹12 lakh under the new regime, excluding special-rate income such as capital gains. For salaried taxpayers, this threshold rises to ₹12.75 lakh due to the ₹75,000 standard deduction.
Income Tax Slabs Remain Unchanged
Sitharaman said the slab structure continues to be designed to benefit all taxpayers by leaving more money in their hands, thereby supporting household consumption, savings and investment.
Revised tax rate structure as follows:
0–4 lakh rupees — Nil
4–8 lakh rupees — 5 per cent
8–12 lakh rupees — 10 per cent
12–16 lakh rupees — 15 per cent
16–20 lakh rupees — 20 per cent
20–24 lakh rupees — 25 per cent
Above 24 lakh rupees — 30 per cent
With no change in slabs, Budget 2026 signals continuity on personal taxation, providing certainty to salaried taxpayers even as the government focuses on broader economic and structural reforms.
