The New Tax Regime in India: An Analysis of Its Effect on Salaried Individuals’ Income Tax Liability in Pune City

This study examines the impact of India’s New Tax Regime on salaried individuals in Pune City. The 2025 Union Budget restructured the tax framework, making the new regime the default and offering simplified slab rates while removing most exemptions. The study compares tax liabilities under both regimes, assessing their effects on disposable income, financial behaviour, and investment patterns. A descriptive-analytical, quantitative approach was used, combining survey responses with secondary data. Findings reveal that while the new regime benefits individuals with limited deductions through higher exemptions and lower rates, the old regime remains advantageous for those claiming housing, insurance, or investment deductions. The study concludes that the New Regime offers simplicity but may discourage long-term savings, suggesting a hybrid approach for balanced financial planning.