Nirmala Sitharaman bets on income tax breaks to spur growth

Nirmala Sitharaman bets on income tax breaks to spur growth

In a bid to make the Union Budget 2025 more ‘pro-middle class,’ Finance Minister Nirmala Sitharaman revealed on Saturday that no income tax will be levied up to an income of ₹12 lakh under the revised new tax regime. A new, simplified income tax bill will be introduced next week, she confirmed.

Following her budget address, Prime Minister Narendra Modi hailed the Union Budget 2025 as a "Force Multiplier" for India's growth, calling it a "budget of aspirations" that aims to benefit 140 crore Indians. He also emphasized that the budget will spur savings, investments, consumption, and overall economic growth.

Economists have also praised the budget, describing it as the ‘need of the hour’ and applauding the ‘fiscal wizardry’ behind the numbers.

Key Announcements from Union Budget 2025

  • Income Tax Relief: In a highly anticipated move, Finance Minister Nirmala Sitharaman announced that no income tax will be imposed on individuals earning up to ₹12 lakh under the revised tax regime. More details about the revised tax rates will be revealed with the new tax bill next week.
  • PM Modi's Praise: Prime Minister Narendra Modi described the budget as a "people’s budget," which will fulfill the dreams of the people of India. He stated that the budget focuses not on increasing government revenue but on putting more money in the pockets of citizens.
  • Support for MSMEs and Sectors: Among the other significant announcements, Sitharaman introduced new classification criteria for MSMEs and a modified ‘Udaan’ scheme to improve regional connectivity. There will also be focused schemes for promoting the footwear and leather industries, as well as a proposal to add 75,000 medical seats over the next five years.
  • Focus on Self-Reliance in Pulses: To promote self-reliance in pulses, the government launched a 6-year mission targeting the development of climate-resilient seeds and enhancing productivity, particularly for tur, urad, and masoor pulses.
  • Support for First-Time Entrepreneurs: A new scheme will be introduced to provide term loans up to ₹2 crore for 5 lakh first-time entrepreneurs, including women, Scheduled Castes, and Scheduled Tribes, over the next five years.
  • Modified ‘Udaan’ Scheme: The ‘Udaan’ scheme will be enhanced to connect 120 new destinations and transport four crore passengers over the next 10 years. This expansion will also support the development of helipads and smaller airports, especially in the North East, hilly areas, and aspirational districts.
  • Greenfield Airports in Bihar: The government will facilitate the development of greenfield airports in Bihar to meet the state's future aviation needs. This will complement the expansion of Patna airport and the establishment of a brownfield airport at Bihta.

Key features of Budget 2025

The Union Budget for fiscal year 2025-26, presented by Finance Minister Nirmala Sitharaman, introduced several landmark measures, with the most notable being a major income tax rebate for individuals earning up to ₹12 lakh. This move aims to provide significant relief to the middle class, making income up to ₹12 lakh tax-free.

In addition to the income tax relief, the budget also outlined several key proposals and initiatives:

Income Tax Rebate: In a significant move to ease the tax burden on the middle class, Finance Minister Nirmala Sitharaman announced that individuals with income up to ₹12 lakh will pay no tax. The revised tax structure includes a 10% tax on income between ₹8 lakh and ₹12 lakh, and a 15% tax on income between ₹12 lakh and ₹16 lakh. However, Sitharaman explained that a tax rebate, in addition to the benefit from the reduced tax slabs, would ensure that individuals earning up to ₹12 lakh pay no tax at all.

Self-Reliance in Pulses: To foster "aatmanirbharta" (self-reliance) in pulses, the government launched a six-year mission with a special focus on tur, urad, and masoor pulses. The initiative will focus on developing climate-resilient seeds, enhancing protein content, and boosting productivity to reduce reliance on imports.

Support for First-Time Entrepreneurs: The government will introduce a new scheme to support 5 lakh first-time entrepreneurs, including women, Scheduled Castes, and Scheduled Tribes, by providing term loans up to ₹2 crore over the next five years.

Modified ‘Udaan’ Scheme: The government will launch a modified ‘Udaan’ scheme aimed at enhancing regional connectivity. The scheme will connect 120 new destinations and transport 4 crore passengers over the next decade, while also supporting helipads and smaller airports in hilly and North East regions.

Development of Greenfield Airports in Bihar: The government will facilitate the development of greenfield airports in Bihar to cater to future aviation needs. This will complement the expansion of Patna airport and the establishment of a brownfield airport at Bihta.

Increase in Medical Seats: Finance Minister Sitharaman announced that 10,000 additional medical seats would be added in the next year, contributing to the goal of adding 75,000 medical seats across the country in the next five years.

Tax Relief for Senior Citizens: The budget proposes to double the tax deduction limit for senior citizens, raising it from ₹50,000 to ₹1 lakh, providing additional financial relief to the elderly.

TDS Revisions: The annual limit for Tax Deducted at Source (TDS) on rent has been increased from ₹2.40 lakh to ₹6 lakh, offering relief to taxpayers.

Support for MSMEs: The classification limits for Micro, Small, and Medium Enterprises (MSMEs) will be enhanced. The investment and turnover thresholds for MSMEs will be increased by 2.5 and 2 times, respectively, to encourage growth and job creation.

Development of Tourist Destinations: The central government will partner with states to develop 50 tourist destination sites through a challenge mode, aiming to boost tourism and create more employment opportunities.

Union Budget 2025-26 reflects a strong focus on inclusive growth, providing tax relief, enhancing infrastructure, and supporting sectors such as healthcare, MSMEs, and tourism. The budget is expected to provide a significant boost to the economy, ensuring long-term growth and development.

References: 

Talk:Nirmala Sitharaman bets on income tax breaks to spur growth

People on can use this Wall page to post a public message for you, and you will be notified when they do.

user Page Content

does not have a user page with this exact title. In general, this page should be created and edited by User:Hafizjunaid06. To start a page called User:Hafizjunaid06, type in the box below. When you are done, preview the page to check for errors and then publish it.
does not have a user page with this exact title. In general, this page should be created and edited by User:Hafizjunaid06. To start a page called User:Hafizjunaid06, type in the box below. When you are done, preview the page to check for errors and then publish it.

View Source Page Content

Title User Name Date
Nirmala Sitharaman bets on income tax breaks to spur growth Amit@Rajput 03 Feb 2025 05:17 PM

© 2025 Explorepedia Foundation. All rights reserved.

Facebook Facebook Facebook Facebook