Union Finance Minister Nirmala Sitharaman delivered her eighth consecutive Union Budget today in the Lok Sabha, bringing significant relief to the middle-class with a major revision in income tax slabs. Under the new tax regime, individuals earning up to ₹12 lakh annually will no longer need to pay any income tax. This announcement was part of a series of measures aimed at stimulating economic growth and increasing consumer spending.
Key Highlights of Budget 2025:
1. Fiscal Policy Adjustments:
The government has set the fiscal deficit target for FY25 at 4.8% of GDP, with a projection to reduce it further to 4.4% in FY26. This is part of a broader strategy to maintain fiscal discipline while supporting economic growth through strategic investments.
2. Jan Vishwas Bill 2.0:
In a move to bolster confidence in the Indian business environment, the Jan Vishwas Bill 2.0 will be introduced, which aims to decriminalize over 100 provisions in various laws. Additionally, an ‘Investment Friendly Index of States’ will be launched later this year to encourage competitive governance and attract investments.
3. Tariff Revisions:
The budget proposes significant changes in tariff rates, including the removal of seven additional rates over and above those removed in the previous budget. After these changes, only eight tariff rates will remain, simplifying the tax structure and potentially reducing the cost of various goods.
4. Infrastructure Investments:
A massive outlay of ₹1.5 lakh crore has been allocated for 50-year interest-free loans to states dedicated to capital expenditure and infrastructure development, highlighting the government’s focus on strengthening the nation’s physical assets to support long-term economic resilience.
5. Healthcare Support:
In a boon for healthcare, the budget has fully exempted 36 life-saving drugs and medicines from basic customs duty, aiming to make healthcare more affordable and accessible to all citizens.
Economic Survey and Budget Session:
The budget session commenced with the Economic Survey on January 31, setting the stage for the budget presentation. The survey highlighted key economic trends and challenges, providing a framework for today’s fiscal announcements.
The changes to the tax slabs are particularly noteworthy as they promise to increase disposable income for middle-class families, potentially boosting consumer spending and aiding in the economic recovery post-pandemic. This budget reflects the government’s commitment to sustaining growth through pragmatic fiscal management, strategic investments in infrastructure, and supportive measures for both businesses and individual taxpayers.
