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@article{192416,
        author = {RAJLEE GOHAIN and Dundu Harshitha and Nishchay Nag and B Chaitanya Mahesh and Dr Tejaswini S},
        title = {IMPACT OF THE INR 12 LAKH TAX-FREE THRESHOLD ON MIDDLE-CLASS DISPOSABLE INCOME IN INDIA: A LEGAL AND ECONOMIC ANALYSIS},
        journal = {International Journal of Innovative Research in Technology},
        year = {2026},
        volume = {12},
        number = {9},
        pages = {1376-1382},
        issn = {2349-6002},
        url = {https://ijirt.org/article?manuscript=192416},
        abstract = {The 2025 Union Budget saw a major transformation in the personal income tax in India, as the tax threshold on which income taxes were paid without payment was increasing to 12 lakh in the new tax regime. This policy measure is aimed to boost the disposable income for the middle class taxpayers and stimulate economic growth through consumption led growth. This study analyses the legal framework and economic implications of the 12 lakh tax-free threshold from a particular angle, i.e. its implications on the disposable income of the middle class. Using secondary data sources such as budget documents, statutory provisions and economic reports, the study conducts a comparative analysis of tax liability before and after the implementation of the revised threshold. The findings suggest a significant decrease in tax burden for those who are eligible to pay the tax which leads to a higher disposable income, better saving prospects and positive consumption effects. However, the benefits are unequally distributed among different income groups and are dependent on choice of tax regime. The paper then wraps up by pointing to the economic applicability of the policy, but also points out limitations concerning long-term fiscal sustainability, inflation and disparity based in the regime.},
        keywords = {Tax; Disposable Income; tax regime; income tax; middle class; income tax; tax regime; tax free amount; tax policy; income tax; India.},
        month = {February},
        }