NEW DELHI: Union Finance Minister Nirmala Sitharaman did not announce a change in income tax slabs for individuals in the Union Budget 2021. The only change announced in regards to individuals' income tax was that senior citizens aged more than 75 years will now be exempted from filing Income Tax Returns.

In her Budget speech last year, Finance Minister Nirmala Sitharaman had introduced a new income tax regime under which tax rate was reduced. However, the reduced rates were applicable only for those who would forego their exemptions.

People who wished to include the exemptions were allowed to stick to the old tax regime.

The income tax changes announced last year were seen as an attempt to overhaul the income tax structure for individuals. Announcing the move, Nirmala Sitharaman had said it will "lower the income tax" a salaried individual pays.

However, there was a catch to the new scheme. Under the new income tax regime, which has so far been optional, you will not be able to avail of all of the deductions or exemptions that earlier allowed you to lower the amount of your salary that was taxed.

The income tax scheme last year included the following tax slabs:

• For incomes of up to Rs 5 lakh per year, there will be no income tax.
• For incomes between Rs 5 lakh and Rs 7.5 lakh per year, the income tax to be paid will be 10 per cent.
• For incomes between Rs 7.5 lakh and Rs 10 lakh per year, the income tax to be paid will be 15 per cent.
• For incomes between Rs 10 lakh and Rs 12.5 lakh per year, the income tax to be paid will be 20 per cent.
• For incomes between Rs 12.5 lakh and Rs 15 lakh per year, the income tax to be paid will be 25 per cent.
• For incomes above Rs 15 lakh per year, the income tax to be paid will be 30 per cent.

How was the new income tax regime different?

Under the old income tax regime incomes between Rs 5 lakh and 10 lakh are taxed at 20 per cent while all incomes above Rs 10 lakh are taxed at 30 per cent.