The Indian tax department has revised the valuation of rent-free accommodations provided by employers, resulting in lower taxable values and potentially higher take-home salaries for employees benefiting from such arrangements. Under the new provisions effective from September 1, 2023, the valuation will be 10% of salary in cities with populations exceeding 40 lakhs (previously 15%), 7.5% in cities with 15-40 lakh populations (previously 10%), and 5% in other areas (previously 7.5%). This change aims to rationalize perquisite value calculation. While it may reduce taxable income for higher-income employees, experts note it might not significantly impact lower-income earners.