The new income tax law will come into effect from April 1, 2026, know what will change for taxpayers and what will remain the same?

By Samira Vishwas On Mar 26, 2026

Tezzbuzz Desk- Many taxpayers have a question in their minds regarding the coming financial year 2026-27 whether there is going to be a change in the income tax slab from April 1, 2026. The reason for this is the new law Income-tax Act, 2025, which will come into effect from this date.

However, there is confusion regarding this new law. Let us understand in simple language what is actually changing and what is not.

Will tax slabs change from April 1, 2026?

The straight answer is no. In Budget 2026, Finance Minister Nirmala Sitharaman had clarified that despite the implementation of the new law, no change has been made in the tax slab. That means in FY 2026-27, you will have to pay tax as per the same tax structure which is applicable now.

Old Tax Regime

The slabs in the old tax system are as follows:

Rs 0 to Rs 2.5 lakh: No tax
Rs 2.5 lakh to Rs 5 lakh: 5%
Rs 5 lakh to Rs 10 lakh: 20%
Above Rs 10 lakh: 30%

This system is beneficial for those who avail deductions and exemptions (like 80C, HRA etc.).

New Tax Regime FY 2026-27

The slabs of the new tax system will be as follows:

Rs 0 to Rs 4 lakh: 0%
Rs 4 lakh to Rs 8 lakh: 5%
Rs 8 lakh to Rs 12 lakh: 10%
Rs 12 lakh to Rs 16 lakh: 15%
Rs 16 lakh to Rs 20 lakh: 20%
Rs 20 lakh to Rs 24 lakh: 25%
Above Rs 24 lakh: 30%

Special features of the new tax system

This is now the default tax system
If you do not select any option, the same system will apply
You can choose the old system while filing ITR (with some conditions)
Under Section 87A, tax exemption can be given on income up to Rs 12 lakh.

What will be the impact of Income-tax Act, 2025?

The new law has been brought to make the tax system more simple and systematic. But there has been no change in the tax slab or rates.

What is changing and what is not?

The structure (law) of the tax system will be new
No change in tax slab
The new tax system will be default
Option of both systems will be available

Advice for taxpayers

While doing tax planning in FY 2026-27, it is important to understand which system is better for you. While the old system may be fine if you have high investments and take deductions, the new system is a better option for simple tax calculations. Therefore, do not be under any illusion that from April 1, 2026, the tax slabs will remain the same, there is no change.