Income Tax Rule: The central government has given a big gift to the taxpayers in the budget 2025. In the budget, the government has increased the tax exemption (Income Tax filing 2025) on annual income of Rs 7 lakh to Rs 12 lakh.
This means that now those earning Rs 12 lakh per year will not have to pay even a single rupee tax, but what will happen to those earning more than this?
They will have to pay tax on their earnings. In such a situation, the thought comes to the mind of taxpayers that there is no state or city in the country where no tax has to be paid. Let us tell you that there is a state in India where the natives do not have to pay a single rupee tax even after earning lakhs and crores of rupees.
People living in this state do not have to pay tax –
No one wants to give even a small part of their earnings to the government as tax. Some people even find many ways to avoid this, but do you know that there is a state in India where there is zero tax on income? Yes, you are reading it right, Sikkim is a state where a person living there does not have to pay any tax on their income (tax-free state).
Sikkim (tax exemption Sikkim) is the only state of India, where under Article 371 (F) of the Constitution and Section 10 (26AAA) of the Income Tax Act, the natives do not have to pay tax even if they earn lakhs and crores of rupees annually. Now, the question must be coming to your mind: how did this state get this special facility?
Let us tell you that when Sikkim (Sikkim income tax rules) was merged with India in 1975, it had its own administrative and tax rules. When Sikkim was being merged with India, the administration there proposed to the Government of India that they have certain conditions and rules would have to be maintained even after merging Sikkim with India. Article 371(F) was added to the Constitution.
Exemption is given on these incomes –
Due to this article, the natives of Sikkim (why Sikkim is exempt from tax) got income tax exemption, which is still applicable. According to Section 10(26AAA), the natives of Sikkim do not have to pay any tax on their income, such as salary, business, profit from shares, interest, or investment.
This special provision has been made to preserve the cultural and historical identity of Sikkim, which makes it different from other states of India. This state also remains the most discussed topic during the days of ITR filing due to the special facility of tax exemption.
These people do not get the tax exemption facility –
RBI gave important information about the 2 thousand rupee note
People living in Sikkim do not have to pay any income tax on their income, but there are some rules and conditions for this, too. This means that not all the people living there get the benefit of tax exemption. Only those people who are registered in the Sikkim Subject Regulation of 1961 and are descendants of the people registered at that time get tax exemption. New people or people who have just settled in Sikkim do not get the benefit of tax exemption.