Income Tax Rebate: Taxpayers Received Twice the Exemption Compared to Corporates, Government Provided ₹8.7 Lakh Crore in Tax Relief

The central government has granted ₹8.7 lakh crore in tax exemptions to individual taxpayers and Hindu Undivided Families (HUFs) over the past five years, which is twice the amount provided to corporate entities. This data was officially presented in the Lok Sabha, revealing a significant tax relief for individuals compared to businesses.

Tax Exemptions for Individuals vs. Corporates

The latest government report highlights that:

• Individuals and HUFs received a total tax rebate of ₹8.7 lakh crore over five years.
• Corporate entities, on the other hand, were granted ₹4.5 lakh crore in tax relief during the same period.

These figures counter the claims made by the opposition, which has often accused the government of favoring large businesses over the middle-class and salaried individuals. Ahead of the 2025-26 financial year budget, these accusations resurfaced, but the latest data suggests a stronger focus on tax benefits for individuals.

Major Tax Relief for Middle-Class Earners

During the announcement of the first full budget of the Modi government's third term, Finance Minister Nirmala Sitharaman introduced a major tax relief under the new tax regime. The key highlights include:

• Individuals earning up to ₹12 lakh annually will no longer be required to pay any income tax.
• This initiative aims to reduce the financial burden on the middle class, allowing an additional ₹1 lakh crore to be available for spending, savings, and investments.
• The decision is expected to boost domestic consumption and strengthen economic growth.

Revised Tax Slabs & Standard Deduction Benefits

The new tax regime for 2025-26 introduces a revised tax-free income limit along with standard deduction benefits:

• Income up to ₹12 lakh is now completely tax-free.
• Individuals earning up to ₹12.75 lakh annually can also avoid taxes due to a ₹75,000 standard deduction that remains applicable under the new system.
• Additionally, the basic tax exemption limit has been raised to ₹4 lakh, meaning no tax is applicable on annual incomes up to this amount.

Special Benefits for Senior Citizens

Senior citizens have also been granted significant tax relief in the latest budget. The Tax Deducted at Source (TDS) limit on interest income has been doubled:

• Previously, TDS was applicable on interest earnings above ₹50,000.
• This limit has now been increased to ₹1 lakh, benefiting senior citizens with higher fixed deposit (FD) earnings.

Final Thoughts

The government’s decision to provide twice the tax rebate to individuals compared to corporates underlines its focus on middle-class welfare and financial empowerment. By making ₹12 lakh annual income tax-free and offering standard deductions and higher TDS limits, the budget aims to boost savings, investments, and overall economic growth while easing the tax burden on citizens.