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Finance Minister Nirmala Sitharaman has made history by presenting the Union Budget for 2025-26 on February 1, 2025, in Parliament. This is the 8th consecutive year that Finance Minister Nirmala Sitharaman has presented the budget. The budget is expected to make significant allocations for various sectors like agriculture, industry, health, and education, which aim to provide relief to the common public and create employment opportunities. This budget is also essential for realizing an ‘Atmanirbhar Bharat’ (Self-Reliant India).
Stay connected with us for timely updates on all the crucial information related to the budget.
Budget 2025 Key Highlights: For latest updates on the Budget 2025, download the official PDF here!
Budget 2025 Key Highlights and Updates
The Union Cabinet had already approved the Budget 2025 before its presentation, and you can find the latest updates here.
FM declares PIT reforms, rationalization of TDS and TCS
Sitharaman announces PIT reforms, rationalisation of TDS and TCS, reducing compliance burden. The government has announced exemptions from Basic Customs Duty (BCD) on cobalt powder, lithium-ion battery waste and scrap, lead, zinc, and 12 other essential minerals. In addition, 35 more items related to electric vehicle (EV) battery manufacturing and 28 items for mobile phone battery production will be added to the list of exempted capital goods.
Also Read | Budget 2025 Tax Slab: Key Tax Slab Changes For Middle Class From New Regime! Check Updated Details Here!
Emphasis on Gig economy
FM Nirmala Sitharaman declared that one crore gig workers would be given ID cards, mainly the ones who are working on platforms like Swiggy, Zomato, Zepto, and BigBasket.
This initiative would give them due recognition and provide social security benefits to them.
- In addition, the workers will be covered under PM Jan Arogya Yojana and their registration is being made easier through the e-Shram portal.
- The development concurs with a surge in the growth of the quick commerce sector, which has grown to a $6 billion market within four years.
- Development is likely to improve social security in the online commerce area.
New Tax Bill Will be Simple and Straightforward
The new income tax bill is drafted to be simple, with clear language that ensures easy comprehension for both taxpayers and tax administrators. Its transparent wording seeks to eliminate ambiguity, making it more accessible and user-friendly for everyone.
Patient Assistance Program of Pharmaceutical Companies Shall be Exempted from BCD
The patient assistance programs of pharmaceutical companies will be exempted from BCD as long as medicines are provided free of charge to patients. Besides, 37 new medicines and 13 new patient assistance programs will be added to the exemption list.
Budget Announcements
| Sector | Announcement | Details/Comments |
| Income Tax | New income tax regime | - Income up to Rs 12 lakh: No tax - Rs 8-12 lakh: 10% - Rs 12-16 lakh: 15% - Rs 16-20 lakh: 20% - Rs 20-25 lakh: 25% - Above Rs 25 lakh: 30% |
| TDS on rent | Annual limit raised from Rs 2.4 lakh to Rs 6 lakh | |
| Tax deduction for senior citizens | Limit doubled to Rs 1 lakh | |
| Tax for salaried taxpayers | No income tax payable for income up to Rs 12.75 lakh | |
| Tax on income up to Rs 4 lakh | Set at 0% under the new regime | |
| Start-ups | Benefits continuation | Benefits for start-ups will continue for five years from inception |
| Banking/Insurance | Grameen credit score framework | To be established for rural India |
| FDI in insurance sector | Limit raised to 100% | |
| Housing | Housing fund | Allocation of Rs 15,000 crore for the completion of one lakh housing units |
| Agriculture | Atmanirbharta in oil seeds | Six-year mission launched |
| Cotton yield improvement | Five-year mission initiated | |
| Kisan Credit Card | Loan limit increased from Rs 3 lakh to Rs 5 lakh | |
| Education | Atal Tinkering Labs | To be established in schools |
| Broadband internet | Provision for government secondary schools | |
| IIT infrastructure | Additional infrastructure to increase student capacity; IIT Patna to be expanded | |
| Healthcare | Daycare cancer centres | To be set up in all district hospitals; 200 centres planned by fiscal 2026 |
| Duty on life-saving drugs | Six life-saving drugs to have a 5% duty; 36 drugs exempted from basic customs duty | |
| Growth | MSME credit guarantees | Coverage raised from Rs 5 crore to Rs 10 crore |
| Infrastructure | PPP mode projects | Three-year projects can be implemented in PPP mode |
| Interest-free loans | Rs 1.5 lakh crore allocated for states to implement infrastructure reforms | |
| Regional airports | Over 100 new regional airports planned over the next decade | |
| UDAN 2.0 | To connect 120 new airports, with a focus on Northeast and Bihar | |
| Excise/Customs Duty | Export promotion mission | Set up for easier access to export credit |
| Tariff rates | Proposal to remove seven tariff rates, leaving eight remaining | |
| Economy | Investment-friendly index | To promote competition among states |
| Fiscal deficit | Revised fiscal deficit target set at 4.8% for fiscal year 2025 | |
| Capital expenditure | Set at Rs 10.18 lakh crore | |
| Women's Development | Term loan for women entrepreneurs | Up to Rs 2 crore available for first-time entrepreneurs from SC/ST and backward classes |
| Rural India | Nutritional support | For over eight crore children and one crore lactating mothers |
| Make in India | National Manufacturing Mission | Provides policy support and monitoring framework |
| Clean technology manufacturing mission | New initiative launched | |
| Nuclear Energy Mission | Focused on research and development | |
| Water Management | Jal Jeevan Mission | Extended until 2028 |
| Technology | Centre of Excellence in AI | To be established with an allocation of Rs 500 crore |
| EV battery manufacturing | Additional capital goods for production | |
| Tourism | Visa fee waivers | For certain tourist groups |
Why is Budget 2025 Important?
Budget 2025 is crucial because it proposes strategic allocations and reforms to boost economic growth, create jobs, and strengthen social welfare programs. The emphasis is on inclusive development and improving the living standards of citizens.
Expected Changes in Tax Policies
The Budget 2025-26 focuses on critical issues such as tax policies, expenditure priorities, and subsidies. One of the key expectations is a revision in the tax slabs, mainly aimed at providing relief to the middle class.
Promotion of New Tax Regime
The government is considering raising the standard deduction limit in the new tax regime. This would encourage more taxpayers to shift from the old tax regime to the new one, simplifying the tax structure.
Possible Changes in Tax Slabs
A new tax slab of 25% could be introduced for income ranging from ₹20 lakh to ₹25 lakh.
The basic exemption limit for income tax could be increased to ₹5 lakh.
Senior citizens may receive additional tax relief under section 80D in the new tax regime.
Importance of Financial Stability
Proper management of fiscal policies can significantly improve the national financial health, while poor management can lead to instability. It will be crucial to see how essential services like tax, education, health, and subsidies are managed in this budget.
The Union Budget 2025-26 is a significant step towards fostering economic growth and social welfare. With expected changes in tax policies, sector-specific allocations, and initiatives for financial stability, this budget will have a lasting impact on India's development in the coming years. Stay connected for the latest updates, and download the complete PDF for detailed information on all key highlights and announcements.
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