Updated 12:35 IST, February 1st 2025
No Income Tax For Upto Rs 12 Lakh Income: FM's Big Gift To Middle Class
In 2014, the exemption limit was raised to Rs 2.5 lakh, then Rs 5 lakh in 2019, Rs 7 lakh in 2023, and now Rs 12 lakh in Budget 2025.

Union Budget 2025: In a key announcement during Budget 2025, the Finance Minister annouced that individuals earning up to Rs 12 lakh annually will now be exempt from income tax. This aims to reduce the tax burden on the middle class, leaving more money in their hands for consumption, savings, and investment.
The Finance Minister stressed that the government has consistently raised the nil tax slab over the years.
"We have periodically reduced the tax burden. Right after 2014, the nil tax lab was raised to Rs 2.5 lakhs. Which was further raised to Rs 5 lakh in 2019 and to Rs 7 lakh in 2023. I am now happy to announce that they will be no income tax payable up to income of Rs 12 lakh," the finance minister annouched.
Income tax exemption history
Over the years, the income tax exemption limit in India has steadily increased, reflecting the government's focus on easing the tax burden on individuals. In 2005, the exemption limit was Rs 1 lakh, which was later raised to Rs 2 lakh in 2012. In 2014, the government further increased it to Rs 2.5 lakh, and then to Rs 5 lakh in 2019. The exemption limit was again raised to Rs 7 lakh in 2023, and in Budget 2025, the limit is now further enhanced to Rs 12 lakh.
This announcement will bring immediate relief to the salaried class, particularly those earning an average of Rs 1 lakh per month. The Finance Minister also mentioned that the standard deduction of Rs 75,000 for salaried taxpayers will bring the tax-free threshold to Rs 12.75 lakh.
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Published 12:21 IST, February 1st 2025