Key Highlights of the Union Budget 2025
Here are the key highlights of the Union Budget 2025 presented by Finance Minister Nirmala Sitharaman today on February 1, 2025:
Summary of Budget 2025-26
Vision & Goals
- Guiding Principles: Inclusivity, growth, and reforms to achieve Viksit Bharat.
- Focus Areas: Agriculture, MSMEs, investment, and exports.
- Objectives: Secure inclusive development, boost middle-class spending power, stimulate private sector investment, uplift household sentiment, and accelerate economic growth.
Key Measures
1. Agriculture & Rural Development
- PM Dhan-Dhaanya Krishi Yojana: Focus on Agri Districts.
- National Mission on High Yielding Seeds: Climate-resilient and high-yielding seeds.
- Aatmanirbharta in Pulses: Special focus on Tur, Urad, and Masoor.
- Credit Boost: ₹5 lakh short-term loans for 7.7 crore farmers.
- Makhana Board in Bihar: To enhance production and marketing.
- Cotton Productivity Mission: A 5-year program for sustainable cotton farming.
2. MSMEs & Entrepreneurship
- Credit Cards for Micro Enterprises: ₹5 lakh limit for businesses on the Udyam portal.
- First-Time Entrepreneurs Scheme: Loans up to ₹2 crore for 5 lakh entrepreneurs, including women and SC/STs.
- Labour-Intensive Sectors: Support for footwear, leather, toys, and food processing industries.
- Make in India: Revised investment & turnover limits for MSMEs to boost production.
3. Education & Skill Development
- Saksham Anganwadi & Poshan 2.0 for child nutrition.
- Atal Tinkering Labs: 50,000 labs in government schools.
- Broadband Connectivity: All rural government schools and health centers.
- Expansion of IITs & AI in Education: ₹500 crore allocated.
- Medical Education: 10,000 new seats, aiming for 75,000 in 5 years.
4. Infrastructure & Urban Development
- Urban Challenge Fund: ₹1 lakh crore for city redevelopment & sanitation.
- Jal Jeevan Mission: Extended till 2028 with an enhanced budget.
- Asset Monetization Plan: ₹10 lakh crore to fund new projects.
- Power Sector Reforms: ₹1.5 lakh crore for infrastructure development.
- UDAN Scheme: Regional connectivity to 120 new destinations, 4 crore passengers in 10 years.
- Maritime Development Fund: ₹25,000 crore corpus for long-term financing.
5. Financial & Regulatory Reforms
- Insurance Sector: FDI limit raised to 100%.
- NaBFID: Partial Credit Enhancement for infrastructure bonds.
- ‘Grameen Credit Score’ Framework: To facilitate credit for rural citizens.
- New Income Tax Bill & Jan Vishwas Bill 2.0: Decriminalizing over 100 laws.
6. Direct & Indirect Tax Proposals
- Income Tax Slabs for Individuals: Income up to ₹4 lakh is now completely tax-free, compared to ₹2.5 lakh earlier. Significant reductions for income between ₹4-16 lakh, reducing the overall tax burden.
- Senior Citizens: Tax deduction limit on interest income raised to ₹1 lakh (from ₹50,000).
- TDS on Rent Relaxed: Annual limit for TDS on rent increased from ₹2.4 lakh to ₹6 lakh.
- Voluntary Compliance Measures – Time limit for filing updated tax returns extended to 4 years (from 2 years).
- Customs Tariff Rationalization: Reduced compliance and duty exemption on critical goods like EV batteries, medical drugs, and MSME raw materials.
Proposed Income Tax Slabs for FY 2025-26
Personal Income Tax reforms with special focus on the middle class. The Union Budget 2025-26 aims to simplify taxation and reduce the burden on the middle class. The revised tax slabs will look as follows:
New Income Tax Slabs (For Individuals & HUFs)
| Annual Income (₹) | Tax Rate (%) |
|---|---|
| 0 – 4 lakh | Nil |
| 4 – 8 lakh | 5% |
| 8 – 12 lakh | 10% |
| 12 – 16 lakh | 15% |
| 16 – 20 lakh | 20% |
| 20 – 24 lakh | 25% |
| Above 24 lakh | 30% |
7. Economic Indicators & Fiscal Management
- Fiscal Deficit: Targeted at 4.4% of GDP.
- Total Budget Expenditure: ₹39.4 lakh crore.
- Revenue Receipts: ₹34.2 lakh crore.
- Capital Expenditure: ₹15.5 lakh crore.
This budget prioritizes economic growth, social inclusivity, and innovation, balancing fiscal discipline with development.