At present up to Rs.250000/- there is no tax., as informed by Mr. Jeevarathnam . But it will vary depends upon the budget proposal of central government every year. As of now it is exempted upto Rs.250000/-.
Moreover, to have better and effective tax free salary payable to the employee the salary structure may be split into Basic, DA , Conveyance allowance , HRA , medical allowances, LTA etc.,
The conveyance allowance up to Rs.19200/- per annum , HRA subject to certain conditions, medical allowance up to Rs.15000/- per annum , LTA subject to certain specified conditions, is exempted in addition to the basic exemption of Rs.250000/-.
It is better to design your salary structure in such a way to avoid tax - (TDS) legally and to help the employee to get more on hand .