Highlights of Indian Union Budget 2025-26

The Union Budget is the annual financial statement of the Government of India, outlining its revenue and expenditure for the upcoming fiscal year. It serves as a blueprint for the nation’s economic priorities, policies, and reforms.

The Union Budget 2025-26, presented by Finance Minister Nirmala Sitharaman on February 1, 2025, is a progressive and inclusive roadmap aimed at fostering economic growth, empowering citizens, and achieving self-reliance. With a strong focus on middle-class welfare, agriculture, MSMEs, and innovation, this budget has introduced several transformative measures.

Key Highlights of the Union Budget 2025-26

1. Tax Reforms to Boost Middle-Class Savings and Consumption

• One of the most significant announcements in the budget is the relief provided to the middle class. Under the new tax regime, individuals with an average monthly income of up to ₹1 lakh will pay no income tax, significantly boosting disposable income and household savings.
• Additionally, the salaried class will pay nil income tax up to ₹12.75 lakh per annum under the new tax regime. This move is expected to enhance consumption and stimulate economic growth.

2. Focus on Agriculture and Rural Development

• The budget recognizes agriculture as one of the four engines of development. To benefit 1.7 crore farmers, the government has launched the ‘Prime Minister Dhan-Dhaanya Krishi Yojana’, which will focus on 100 districts with low agricultural productivity.
• Furthermore, the ‘Mission for Aatmanirbharta in Pulses’ will be launched, with a special emphasis on tur, urad, and masoor crops. Farmers will also have access to loans up to ₹5 lakh through the Kisan Credit Card (KCC) under a modified interest subvention scheme.

3. Empowering MSMEs and Boosting Manufacturing

Micro, Small, and Medium Enterprises (MSMEs) are the backbone of the Indian economy. To support their growth, the budget has enhanced credit guarantee coverage from ₹5 crore to ₹10 crore. Additionally, a National Manufacturing Mission has been announced to further the ‘Make in India’ initiative, covering small, medium, and large industries.

4. Fiscal Discipline and Economic Growth

The fiscal deficit for FY-25 is estimated at 4.8% of GDP, with a target to reduce it to 4.4% in FY-26. This reflects the government’s commitment to fiscal discipline while ensuring sustained economic growth.

5. Innovation and Education

• The budget emphasizes innovation and education as key drivers of progress. A Centre of Excellence in Artificial Intelligence for Education has been proposed, with an outlay of ₹500 crore.
• Additionally, 50,000 Atal Tinkering Labs will be established in government schools over the next five years to foster creativity and innovation among students.

AI in Education: Transforming the Learning Experience

6. Healthcare and Social Welfare

• Gig workers will now receive identity cards, registration on the e-Shram portal, and healthcare benefits under the PM Jan Arogya Yojana.
• The PM SVANIDHI scheme has been enhanced, offering increased loans and UPI-linked credit cards with a ₹30,000 limit to street vendors.

7. Boosting Exports and Domestic Manufacturing

• To promote domestic manufacturing, the budget has exempted Basic Customs Duty (BCD) on raw materials and components used in shipbuilding for 10 years.
• Additionally, BCD on 36 lifesaving drugs and medicines for treating cancer, rare, and chronic diseases has been exempted.
• The budget also supports battery production by exempting additional capital goods for EV and mobile battery manufacturing.

9. Regional Connectivity and Energy

• The Modified UDAN Scheme aims to enhance regional connectivity by adding 120 new destinations.
• A Nuclear Energy Mission has also been announced, with an outlay of ₹20,000 crore for the research and development of small modular reactors.

10. Ease of Doing Business

• The Jan Vishwas Bill 2.0 will decriminalize over 100 provisions in various laws, simplifying compliance for businesses.
• The time limit for updated income tax returns has been extended from two to four years, and delays in TCS payment have been decriminalized.

Tax Planning Tips for Small Business Owners in 2024

What gets cheaper and what gets costlier?

Conclusion:

The Union Budget 2025-26 is designed to provide relief to taxpayers, stimulate economic growth, and foster sectoral development. With a strong focus on agriculture, MSMEs, infrastructure, and technological innovation, the budget aims to create a self-reliant, globally competitive economy.

From
Lingaya’s Vidyapeeth
Best Colleges in Faridabad