The government of India has presented a new Direct Tax code for next financial year. It is a welcome change for millions of people in India as it allows them to save some more money.  This New Direct Tax Code will eventually replace the Income Tax Act of 1961. The Direct Tax Code will be debated in Parliament and if it is approved, it will be implemented from financial year 2011-2012. In new Direct Tax Code, however, several tax-breaks and deductions will be taken away and tax slabs will be increased. Some of the important highlights of Direct Tax Code include the following points.

1. Men will have to pay taxes amounting to Rs. 4, 120 for income up to Rs. 2, 00,000. This amount earlier was fixed at Rs. 1, 60, 000. They will pay taxes amounting to Rs. 4, 120 for income between Rs. 2, 00, 000 and Rs. 8, 00, 000. For income between Rs, 10, 00, 000 and Rs, 50, 00, 000, they will have to pay taxes for Rs. 21, 630.

2. Women will have pay taxes amounting to Rs. 1, 020 for income up to Rs. 2, 00, 000. They will pay similar amount of tax, that is, Rs. 1, 020 for income between Rs, 2, 00, 000. They will have to pay Rs. 21, 630 as tax for income between Rs. 10, 00, 000 and Rs. 50, 00, 000.

3. For senior citizens, the taxes will be applicable from income level of Rs. 2, 00, 000. For income between Rs. 2, 00, 00 and Rs. 8, 00, 000, senior citizens will have to pay Rs. 1, 020 as income tax. They will also have to pay Rs. 21, 630 as tax for income between Rs. 10, 00, 000 and Rs. 50, 00, 000.