The Finance Minister announced the Union Budget for Financial Year 2020-21 on Feb 1, 2020, in the Parliament. Through the introduction of the budget, the Finance Ministry has introduced a New Tax System under which there will be Income Tax Slabs 
Get the details on income tax rates for FY 2019-20 (AY 2020-21). Various rates are provided such as Individual/HUF, Companies, Partnership Firms. Read More from now on.
| Income Tax Slab | Tax Rate |
|---|---|
| Up to Rs 2.5 lakh | Nil |
| Rs 2.5 lakh to Rs 5 lakh | 5% |
| Rs 5 lakh to Rs 7.5 lakh | 10% |
| Rs 7.5 lakh to Rs 10 lakh | 15% |
| Rs 10 lakh to Rs 12.5 lakh | 20% |
| Rs 12.5 lakh to Rs 15 lakh | 25% |
| Rs 15 lakh and above | 30% |
The idea of new tax slabs was taken from the deep study of the tax system of other economies. According to a study, the country having fewer Income tax slabs face more issues. Fewer tax slabs lead to an increase in discrimination of taxpayers and create problems for the taxpayers of low-income groups. The slabs are to be introduced from April 1, 2020, officially.
“People say there should be one or two slabs but that would be highly inequitable… Rates would have to be steep if we have one or two slabs. The income tax structure has to be progressive. We studied slabs in developing countries, developed countries, neighboring countries before these were worked out,” said Ajay Bhushan Pandey, the Revenue Secretary.
The New Tax System is for those taxpayers who opt-out of exemptions and deductions of the older tax system and is completely optional.
End of Tax Exemption
The Finance Minister said that all the previous exemptions provided to the taxpayers will be scrapped slowly and a new smooth system will be brought in force. The taxpayers having a total income of more than INR 15 Lakhs will now be able to save up to 78,000 through the new tax system. Moreover, it will also benefit the low-income group as they will be charged lower tax rates. Giving the option of leaving the exemptions is the first step towards a simple tax system.
Singapore Has 11 and China 7 Tax Slabs
Pandey said that the introduction of more tax slabs will not be harmful to the economy instead it will benefit the taxpayers of all income groups. “The system will show tax liability in pre-field forms,” he said. Singapore has 11 tax slabs and China has 7 tax slabs with the highest tax at 45%. Both countries retain good economic positions in the world and are the perfect example of the successful implementation of more tax slabs.
Pandey also said that the government will issue a notification as soon as the bill related to Income Tax Dispute Settlement Scheme 
Know about the tax dispute settlement scheme (Vivad se Vishwas Bill) under the IT act. Under this scheme, taxpayers can settle all disputes before the end of 31st March 2020 is passed in the parliament.
No Pressure
The Revenue Secretary has asked the officials to explain the pros and cons to those taxpayers with whom a continuous dispute is going on to help them understand the scheme properly and make an informed decision. “We are facilitating… We are not forcing anyone… A person must be given a choice. They have been asked to reach out to explain the pros and cons of the scheme.” said Pandey.
Finance Minister Should Dispense With Submission Of Form 15 – H Forthwith In Respect Of
Senior And Super Citizens , Irrespective Of Their Income ; And No Bank , Companies , NBFCs
etc. Should Deduct Any T D S ; All The Banks , Companies , NBFCs Etc. , In Other Words
Whosoever Is Paying Any Interest , Should Fill The 26 – AS Form ( Even When There Is NO TDS )
As All The Banks , Companies , NBFCs , Etc. Are Already Having Everybody’s P A N And AADHAR
CARD DETAILS .
Form 26 – AS
while it may be good to eliminate / withdraw some of the exemptions , to simplify the I T R , some important exemptions should continue , for obvious reasons , particularly for SENIOR CITIZENS And SUPER SENIOR
CITIZENS . Further Even If Some Exemptions Are Removed , The Income Rates Should Be 3 % ; 5 % ;
7% ; 10% ; 12.5 % , 15 % 20% ; 25% ; 30% . The Finance Minister Should Not Think That The Senior
And Super Senior Citizens Are Very Well Off And Very Comfortable And They Will Continue To Be So ;
The Finance Minister Should Control The Ever-Increasing Cost Of Living Instead Of Stabbing The Poor
And Helpless People . The Surprising Fact Is That None Of The M P s has tried To Raise This Point ;
Perhaps , they are not bothered about the poor and helpless people , as , in any case , all of them
are already well off and they continue to get pension etc.