ITR 2026 New Tax Regime: More and more people are picking the new income tax regime when they file returns this year. The change has been building for some time. Earlier this year, CBDT Chairman Ravi Agrawal said around 88% of individual taxpayers had already chosen the new regime based on last year’s filing data. Experts now believe the share may go even higher this season because the new system is easier and gives better tax relief. The official tax department also says the new regime now offers a rebate of up to Rs 60,000 under Section 87A for income up to Rs 12 lakh, along with a standard deduction of Rs 75,000 for salaried taxpayers.
One big reason for this shift is that the new regime has become much more friendly for middle-class taxpayers. The higher rebate, the revised slab rates and the bigger standard deduction have made the old regime less useful for many salaried people. Another reason is simple filing. Under the new system, taxpayers do not need to collect and store so many investment proofs and deduction papers. That makes return filing faster and less tiring.
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Experts Say The New Regime Is Winning Fast
Tax professionals across India say the change is already visible in their own client numbers. CA Harshit Aggarwal, Partner at HJ Aggarwal & Co., said nearly 95 % of taxpayers filing through his firm have gone with the new regime this year, compared with over 70% in AY 2025-26 and just 20% two years ago. Himank Singla, Partner at SBHS & Associates, said more than 90% of taxpayers filing through his firm have chosen the new regime this year. Tax experts say this shows how quickly the shift has grown over the last three years.
Still, the old regime has not disappeared. Mihir Tanna, Associate Director at S.K. Patodia LLP, said the old system can still work better for people who have large deductions. Gopal Bohra, Partner-Tax at NA Shah Associates, said his firm is seeing 80-90%t of individual taxpayers choosing the new regime this year, up from around 70-80% last year. He said the old regime is still useful mainly for people who claim big deductions like HRA, housing loan interest and Chapter VI-A benefits.
Why some people still stay with the Old Regime
The new regime may be the default for many, but it is not the best for everyone. Companies that help with tax filing say taxpayers with large HRA claims, home loan interest or other strong deductions should compare both systems carefully before filing. On tax platforms, the trend is also strong. ClearTax says more than 80% of taxpayers on its platform are likely to choose the new regime this year.
Sudhir Kaushik, Co-founder and CEO of TaxSpanner, said many people earning up to Rs 12 lakh are choosing the new regime because it is simple and needs less paperwork. He also warned that many workers focus too much on take-home pay and do not think enough about long-term savings.
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He said employers can help by giving better salary structures and teaching workers about tax-saving options. Aarjav Jain, Executive Director and NRI Tax Expert at Dinesh Aarjav & Associates, said around 70% of his firm’s clients are using the new regime, while the rest still prefer the old one because of deductions like HRA, home loan interest, education loan interest, charitable donations and savings in EPF, PPF and NPS.
