NEW DELHI: Finance minister Nirmala Sitharaman on Saturday announced a range of

tax reforms

for the common people and the business owners, including the new tax regime, rationalistaion of TDS and TCS along with reforms to ensure enhanced ease in doing in business.
The finance minister said that the tax proposals were driven by income tax reforms for the middle class,

TDS rationalization

, and efforts to ease the compliance burden.

The government announced a "nil tax" slab which would be available up to Rs 12 lakh (Rs 12.75 lakh for salaried taxpayers with a standard deduction of Rs 75,000).

The new structure aims to significantly reduce taxes for the middle class, leaving them with more disposable income to boost household consumption, savings, and investment.

Union Budget 2025 full coverage

Sitharaman announced that the tax deduction limit on interest for senior citizens would be doubled from Rs 50,000 to Rs 1 lakh.
Additionally, she said that the annual TDS limit on rent would be increased from Rs 2.40 lakh to Rs 6 lakh, and the threshold for collecting tax on remittances under the RBI's Liberalized Remittance Scheme will be raised from Rs 7 lakh to Rs 10 lakh.

Union Budget: Income tax slabs 2025-26 full coverage

Sitharaman announced that the compliance burden for small charitable trusts and institutions would be eased by extending their registration period from 5 to 10 years.
Additionally, taxpayers would be allowed to claim the annual value of two self-occupied properties as nil, without any conditions.

In a bid to improve the ease of doing business, the finance minister announced that a scheme would be introduced to determine the arm's length price of international transactions over a block period of three years, aiming to streamline transfer pricing and offer an alternative to annual examinations.