Comprehending Personal Tax Policy: New Tax Regime Using Sentiment Analysis

Abstract

The Government of India introduced a new tax regime (Section 115BAC) in the Finance Act, 2020, with effect from 1 April 2021. The new tax scheme was introduced in parallel to the existing tax regime. Since 2021, the government has made several changes in the slab rates and tax rates of the new tax regime. Section 115BAC became the default tax policy in the Finance Act, 2023. Standard deduction and rebate under Section 87A have also been changed to entice the common people towards the new tax regime. No deductions and exemptions are allowed in the new tax policy. The government wishes to simplify the tax system and reduce the tax evasion. There is also a shift being observed in the saving and investment patterns of the salaried individuals. More young people are shifting their money to the market for a better rate of return. This adds to the risk appetite and affects their liquidity and solvency positions. To understand the impact of the new tax policy, a sentiment analysis has been undertaken on the e-mail interviews taken from the tax experts from different sectors. The interviews were analysed for the two periods: pre-budget and post-budget, 2025, scenario.

Keywords

Personal Tax Income Tax New Tax Regime 115BAC Sentiment Analysis

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