New Delhi, Feb. 1 -- The Union Budget provided a major relief to middle-class taxpayers as Finance Minister Nirmala Sitharaman raised the income tax exemption limit to Rs.12 lakh. According to stock market analysts, this move could increase the disposable income in the hands of the middle class, which could flow into the stock markets, providing further cushion against the heavy foreign investor selling that is currently plaguing Dalal Street.

Under the new tax regime, individuals earning up to Rs.12 lakh annually will not have to pay any income tax. Earlier this limit was at Rs.7 lakh. The government also rationalized the income tax slabs, with individuals earning Rs.24 lakh and above liable to pay 30% income tax as against those who ea...