Budget 2025-Sector wise Highlight

BUDGET 2025-HIGHLIGHT

Tax Exemptions and Relief

• No tax for individuals earning up to Rs 12 lakh annually.

• Taxpayers with an annual income of Rs 25 lakh will benefit from a relief of Rs 1.1 lakh.

• The new tax exemptions will result in a direct tax revenue loss of Rs 1 lakh crore and indirect tax losses of Rs 2,600 crore.

Revised Tax Slabs

• Up to Rs 4 lakh – No tax

• Rs 4 lakh – Rs 8 lakh – 5%

• Rs 8 lakh – Rs 12 lakh – 10%

• Rs 12 lakh – Rs 16 lakh – 15%

• Rs 16 lakh – Rs 20 lakh – 20%

• Rs 20 lakh – Rs 24 lakh – 25%

• Above Rs 24 lakh – 30%

  
  

Additional Income Tax Reforms

• TDS & TCS Rationalization: Fewer TDS rates and thresholds to simplify compliance.

• Higher TCS Threshold for LRS: Raised from Rs 7 lakh to Rs 10 lakh.

• TDS Relief on Rent: Threshold increased to Rs 6 lakh.

• Education Loan Exemption: TCS on education loans up to Rs 10 lakh removed.

• Decriminalization of TCS Delay: Late payment of TCS will no longer be a criminal offense.

• Extended Time for Updated Tax Returns: Filing period increased from 2 years to 4 years.

• Self-Occupied Property Valuation: Taxpayers can now declare the value of two self-occupied properties as nil.

• International Tax Relief: Safe harbor rules expanded to reduce tax disputes.

• Startup Support: Tax benefit eligibility extended by five years.

Customs Duty and Tariff Adjustments

• Removal of seven tariff rates, in addition to previous eliminations.

• Exemption of Social Welfare Surcharge on 82 tariff lines.

• 36 life-saving drugs added to the Basic Customs Duty (BCD) exemption list.

• Increase in BCD on Flat Panel Displays from 10% to 20%.

• Exemption on Critical Minerals: 12 more minerals exempted from BCD.

• 35 Capital Goods for EV Manufacturing included in BCD exemption.

• Reduction in Open-Cell Customs Duty to 5%.

Fiscal Deficit and Market Borrowing

• Fiscal Deficit Projections:

  • FY25: 4.8% of GDP

  • FY26: 4.4% target

• FY26 Tax Receipts: Estimated at Rs 28.37 lakh crore.

• Market Borrowing: Gross borrowing projected at Rs 14.82 lakh crore.

• Capital Expenditure for FY25: Revised to Rs 10.18 lakh crore.

Foreign Direct Investment and New Tax Legislation

• Insurance FDI Limit Increased: Raised from 74% to 100%.

• New Income Tax Bill: To be introduced next week.

• Central KYC Registry: Scheduled for rollout in 2025.

Tourism and Innovation Initiatives

• Development of top 50 tourism sites in collaboration with states.

• Mudra Loans for homestay businesses to promote local tourism.

• Promotion of medical tourism under "Heal-in-India."

• Deeptech Fund-of-Funds to support startups in technology.

• National Geospatial Mission to enhance spatial data mapping.

Energy, Infrastructure, and Regional Development

• Target of 100 GW nuclear energy by 2047.

• Rs 20,000 crore Nuclear Energy Mission for small modular reactors.

• States allowed 0.5% additional borrowing of GSDP upon select reforms.

• Maritime Development Fund with Rs 25,000 crore corpus.

• Modified Udaan Scheme to connect 120 new destinations.

• Greenfield Airports development in Bihar.

• Western Kosi Canal Project to receive funding.

Education, Healthcare, and Social Welfare

• Broadband connectivity for all government secondary schools and PHCs.

• Five National Centers of Excellence for Skilling to enhance vocational training.

• Infrastructure expansion for post-2014 IITs.

• AI Centers for Education with a Rs 500 crore investment.

• 200 District-Level Day-Care Cancer Centers by 2025-26.

• 10,000 additional medical seats in FY26.

• Social Security Scheme for Gig Workers through E-shram portal.

• 50-Year Interest-Free Loans to States: Rs 1.5 lakh crore for capital expenditure.

• Urban Challenge Fund: Rs 1 lakh crore investment.

• Asset Monetization Plan until FY30.

• MoUs under Jal Jeevan Mission to enhance water supply.

Global Economic Outlook

• Geopolitical challenges likely to slow global economic growth.

• India’s economic performance over the last decade has gained international recognition.

Key Focus Areas in Union Budget 2025

1. MSME growth and export promotion.

2. Agricultural and rural development.

3. Manufacturing sector expansion.

4. Financial inclusion.

5. Welfare programs for the poor, youth, farmers, and women.

6. Power sector advancement.

7. Urban development initiatives.

8. Taxation reforms.

Agriculture and Fisheries Reforms

• Dhan Dhanya Krishi Yojana to enhance productivity in 100 districts.

• Support for 1.7 crore farmers under new agricultural initiatives.

• National Mission on High-Yield Seeds.

• Five-Year Cotton Production Boost Plan.

• Fisheries Framework for sustainable utilization of India’s Exclusive Economic Zone (EEZ).

• Kisan Scheme Loan Limit Increase: From Rs 3 lakh to Rs 5 lakh.

MSME and Industrial Growth

• India Post Transformation into a public logistics organization.

• MSMEs as the second engine of growth, benefiting 5.7 crore enterprises.

• Credit Guarantee for MSMEs: Limit raised from Rs 10 crore to Rs 20 crore.

• Customized Credit Cards for Micro SMEs: Rs 5 lakh limit.

• Startup Fund-of-Funds with Rs 10,000 crore support.

• Footwear & Leather Sector Scheme: 22 lakh jobs, Rs 4 lakh crore investment.

• Global Manufacturing Hub for Toys initiative.

Manufacturing, Infrastructure, and Innovation

• National Manufacturing Mission to strengthen Make in India.

• Urea Plant in Namrup, Assam with 1.27 lakh tonnes capacity.

• Solar PV, Electrolyser, and Battery Ecosystem development.

• 50,000 Atal Tinkering Labs for innovation and research.