Income Tax Budget 2025 LIVE: Banking Sector reaction on Union Budget
“The Union Budget reflects a strong commitment to empowering MSMEs, agriculture, and rural credit, which are the backbone of India’s vision for attaining Viksit Bharat. The enhanced focus on credit access for small businesses and farmers will catalyze growth and financial inclusion. Additionally, the increase in tax exemption to ₹12 lakh is a significant step in boosting disposable income and strengthening consumption. Indian Bank remains committed to supporting these initiatives, driving sustainable economic progress, and financial inclusion,” said Indian bank’s MD & CEO, Shri Binod Kumar
Income Tax Budget 2025 LIVE: Expert take on Budget 2025
“the reduction of Jewelry duty from 25% to 20% is a welcome move. For a country like India who is known for its high jewellery consumption, this will definitely boost the demand in the domestic market specially in luxury. Similarly, slashing of duty on platinum finding from 25% to 5% is yet another bold move which will prove beneficial for the entire gems and jewellery industry,” said Colin Shah, MD, Kama jewelry
Income Tax Budget 2025 LIVE: No income tax up to 12 lakh
“This opens up opportunities to explore a variety of wealth-building avenues, from traditional investments like mutual funds and stocks to digital assets like crypto. It encourages financial planning, empowering individuals to diversify their portfolios, and supports long-term wealth creation,” says Edul Patel, CEO and Co-founder of Mudrex.
Income Tax Budget 2025 LIVE: 100% FDI in Insurance
The decision to raise FDI in insurance to 100% will drive greater capital infusion into the sector. This move will not only deepen investments but also foster innovation, enhance competition, and accelerate insurance penetration. “We welcome this progressive reform, which aligns with our commitment to delivering greater financial security to Indians.With strengthened investment,the industry can further drive digital conversion,develop customer-centric solutions,and expand its reach to those who need it most,” said Prashant Tripathy,MD & CEO,axis Max Life Insurance.
Income Tax Budget 2025 LIVE: union Budget 2025 has introduced several tax reforms
Anirudh garg, Partner and Fund Manager at Invasset PMS: The Union Budget 2025 has introduced several tax reforms and sector-specific initiatives that are likely to shape market sentiment and economic growth. The decision to forgo ₹1 lakh crore in direct taxes and offer full tax exemption up to Budget 2025: Big Wins for the Middle Class
Finance Minister Nirmala Sitharaman’s Union budget 2025 presented a significant boost to India’s middle class, with a major focus on tax relief and increased disposable income.
The highlight of the budget was an increase in the income tax exemption limit. Under the new tax regime, individuals earning up to ₹12 lakh will now pay no income tax. “This limit will be ₹12.75 lakh for salaried tax payers,due to standard deduction of ₹75,000,” sitharaman announced,emphasizing the government’s commitment to alleviating the tax burden on middle-class earners.
Sitharaman highlighted the government’s consistent efforts to support the middle class, recalling how the ‘Nil tax’ slab was raised to ₹2.5 lakh in 2014, ₹5 lakh in 2019, and ₹7 lakh in 2023. “This is reflective of our Government’s trust on the middle-class taxpayers,” she stated.
“this budget is highly beneficial for the middle class and senior citizens, with key measures aimed at increasing savings and boosting consumption,” commented Meghna Mishra, Senior Partner at Karanjawala & Co.
“the increase in the TCS threshold limit from ₹7 lakh to ₹10 lakh and the doubling of the TDS threshold for senior citizens provide significant relief.Additionally, with no income tax payable up to ₹12 lakh, disposable income will rise, leading to higher spending and economic growth. These steps not only support the common man and industry but also align with the vision of a Viksit Bharat by 2047, making it a well-balanced and progressive budget,” she emphasized.
Experts anticipate a significant ripple effect across various sectors.
Amit Maheshwari, Partner-Tax at AKM global, a tax and consulting firm, believes the new tax regime will streamline processes for businesses.
“The Finance minister has announced a scheme for transfer pricing to determine arm’s length prices for a block of 3 assessment years if international transactions or specified domestic transactions are the same in 2 consecutive years. This will reduce administrative burden on taxpayers as well as the tax department as there will be no requirement of determining arm’s length price every year. This scheme may be an excellent option for big corporations with a history of litigation every year. Though, adoptability of the scheme might potentially be challenging for small and medium size corporations as they may be sceptical for approaching tax authorities fearing an adverse stand,” Maheshwari stated.
Union Budget 2025: Simplifying Taxes and Empowering Individuals
The Union Budget 2025, presented on February 1st, 2025, marked a significant shift in India’s tax landscape, aiming to simplify the system and boost the purchasing power of individuals, especially within the middle class. Finance Minister Nirmala Sitharaman unveiled a series of key changes that are expected to have a profound impact on taxpayers across the country.
One of the most noteworthy announcements was the increase in the income tax exemption threshold to ₹12 lakh. Sandeep Chilana, Managing Partner at CCLaw, hailed this move as “a deeply positive step,” particularly for middle-class families who are increasingly grappling with rising living costs and inflation. “By increasing disposable income,the government is not only simplifying the tax system but also fostering consumer confidence,” Chilana explained. “This change will impact a broad spectrum of individuals, particularly in urban areas, giving them more room to invest and spend.”
The Budget also introduced a complete restructuring of tax slabs, designed to create a more equitable tax environment. This restructuring, coupled with tax rebate provisions, is projected to provide significant tax savings for individuals at various income levels. For example, a taxpayer with an income of ₹12 lakh will benefit from a tax rebate of ₹80,000, representing a 100% reduction in their tax liability. Individuals earning ₹18 lakh will enjoy a tax benefit of ₹70,000 (30% reduction), while those earning ₹25 lakh will see a tax savings of ₹1,10,000 (25% reduction).
in a move aimed at simplifying homeownership, Finance Minister Sitharaman relaxed the conditions for tax relief on self-occupied properties. Adhil Shetty, CEO of Bankbazaar.com, pointed out that taxpayers can now claim tax benefits for two self-occupied houses, a significant departure from the previous limit of one property.
“This reform significantly eases the tax burden for individuals who own and live in multiple properties, offering financial adaptability and promoting homeownership,” Shetty stated. ”By acknowledging the diverse housing needs of families, this decision not only provides greater tax relief but also encourages real estate investment.”
the Union Budget 2025 prioritizes individual empowerment by simplifying the tax system and enhancing financial well-being. The government’s focus on boosting consumer confidence and promoting investment is a clear signal of its commitment to driving economic growth and creating a more inclusive and prosperous future for all.
India’s Budget 2025: Boosting Middle-Class Spending & Simplifying taxes
The Indian government kicked off 2025 with a bold budget, placing the country’s middle class squarely at the center. Finance Minister delivered a “very welcoming budget,” according to Sandeep Bangla, CEO of TRUST Mutual Funds, praising its balance between stimulating economic growth and maintaining fiscal obligation.
Key highlights of the budget include significant income tax reforms, aimed at increasing disposable income for millions of individuals.
These reforms have been hailed as among the most substantial in a decade, with experts like Adhil Shetty, CEO of BankBazaar.com, emphasizing their potential to inject more money into people’s pockets while remaining fiscally sound.
With inflation adjustments finally factored into income tax slabs,the 30% tax bracket now kicks in at ₹24 lakh,a 60% increase from the previous threshold. “This rationalisation of income tax has been long-awaited,” Shetty noted, adding that it will “reaffirm the confidence of the people in the economy.”
The practical impact of these changes is significant. A taxpayer earning ₹25 lakh annually will now pay ₹3.43 lakh in taxes, a ₹1.14 lakh reduction compared to the previous regime. This translates to an extra 5% in their hands each month, amounting to a substantial saving of around ₹9,500.
“More cash in hand will also mean increased spending, which will drive higher consumption and, in turn, will fuel economic growth,” Shetty explained. He also highlighted the government’s focus on simplifying compliance for salaried taxpayers, further bolstering the confidence of the middle class.
Beyond income tax, the budget also addressed concerns of importers by reducing import duty slabs and simplifying the computation process. Harpreet Singh, Partner, Indirect Tax, Deloitte, lauded the move, stating that “The twin announcements of removal of seven tariffs resulting into reduced eight slabs of duty and levy of only one cess or surcharge thereby exempting 82 tariff line items from social welfare surcharge, would both lead to simplification of import duty computation, thereby easing compliances.” the budget also addressed the industry’s long-standing demand for a time limit on provisional assessments, providing much-needed tax certainty.
While the budget received widespread praise for its focus on middle-class welfare and economic growth,some experts expressed reservations about the government’s capital expenditure plans. Bangla noted that the relatively modest increase in capital expenditure, from ₹11 lakh crore to ₹11.21 lakh crore, could potentially hinder the pace of economic growth.
big Relief for the Middle Class: Income Tax Slabs Rejigged in budget 2025
In a move aimed at boosting household finances and stimulating the economy, Finance Minister Nirmala Sitharaman announced significant changes to the income tax regime during the budget 2025 presentation. Individuals earning up to ₹12 lakh annually will now enjoy tax exemption, marking a major win for middle-income earners.
“I am now happy to announce that there will be no income tax payable up to income of ₹12 lakh (i.e. average income of ₹1 lakh per month other than special rate income such as capital gains) under the new regime,” Sitharaman declared.
For salaried employees, the tax-free threshold rises further to ₹12.75 lakh per annum, taking into account the standard deduction of ₹75,000. This adjustment translates into substantial tax savings for millions.
“The new structure will substantially reduce the taxes of the middle class and leave more money in their hands, boosting household consumption, savings and investment,” Sitharaman emphasized, outlining the government’s vision of empowering individuals through financial relief.
Experts lauded the changes, highlighting the positive impact on individual finances.
According to Gunjan Goel,Director,Goel Ganga Developments,”The launch of the ₹5 lakh scheme exclusively to women,SC and ST is a powerful measure towards economic inclusiveness. Coupled with enhanced MSME credit limits, this offers women entrepreneurs a compelling opportunity to thrive. These initiatives will undoubtedly help bridge the gender gap in business ownership and economic participation.”
Mamta shekhawat,Founder,Gradding.com, echoed Goel’s sentiments, focusing on the multifaceted benefits for families.
“Scaling up Saksham Anganwadi and Poshan 2.0 to include 8 crore children, 1 crore pregnant mothers, and 20 lakh adolescent girls showcases a genuine concern for women’s and children’s health. Such extensive nutritional support, particularly targeting lactating mothers and adolescent girls, promises to create a lasting, positive impact on community health outcomes for generations to come.”
Ridhima kansal, Director, Rosemoore, further emphasized the far-reaching impact of these interventions.
“Women stand to benefit tremendously from both the economic empowerment offered by the ₹5 lakh scheme and the nutritional security provided by Poshan 2.0. This combined approach effectively addresses the health infrastructure gaps alongside financial constraints, paving the way for women’s advancement.”
Budget 2025’s income tax relief package promises tangible improvements in the lives of millions, fostering financial stability, economic growth, and a brighter future for all.
Income Tax Budget 2025: A Focus on simplicity and Middle-Class Relief
The Union Budget for 2025-26 has brought a wave of positive changes for the Indian tax system, with a clear emphasis on simplification and boosting financial flexibility for taxpayers. Finance Minister Nirmala sitharaman unveiled a range of reforms, including adjustments to tax slabs, measures to ease compliance burdens, and incentives aimed at encouraging investments in key sectors.
The most significant changes involve the revamping of personal income tax slabs and rates. The government has introduced new tax brackets, offering a more progressive structure that benefits middle-class individuals. The new slabs are structured as follows:
- ₹0-₹4 lakh: Nil tax
- ₹4-₹8 lakh: 5%
- ₹8-₹12 lakh: 10%
- ₹12-₹16 lakh: 15%
- ₹16-₹20 lakh: 20%
- ₹20-₹24 lakh: 25%
- Above ₹24 lakh: 30%
These changes aim to create a fairer system where higher earners contribute a greater proportion of their income in taxes, while those with lower incomes receive more financial breathing room.
Beyond tax adjustments, the government has also taken steps to streamline the tax compliance process. Kuljeet Singh,Director of Finance and Accounts at GI Group Holding,applauded these measures,stating,”Budget 2025 brings much-needed tax reforms aimed at simplification,compliance ease,and middle-class relief. The extension of the updated tax return filing window to four years offers greater flexibility to taxpayers to rectify or revise their filings. Rationalizing TDS and TCS,along with increased thresholds on rent and LRS remittances for individuals,will ease compliance. The removal of TCS on education loans up to ₹10 lakh is a positive step for families investing in higher education.”
The government has also expanded the reach of tax benefits under the National Pension Scheme (NPS) by extending the benefits available under sub-section (1B) of section 80CCD of the Income-tax Act, 1961 to contributions made to NPS Vatsalya accounts.
The budget also signals a major shift in the insurance sector with the announcement that the Foreign Direct Investment (FDI) limit will be raised to 100 per cent, up from the previous limit of 74 per cent. This move aims to attract greater foreign investment and bolster the growth of the insurance industry in India.
Finance Minister Sitharaman emphasized the government’s commitment to creating a more taxpayer-friendly environment, highlighting initiatives such as faceless assessment and the introduction of a taxpayers’ charter.
Budget 2025: A game-Changer for Income Tax
The Union Budget 2025, presented on 1st February 2025, brought a wave of changes to the Income Tax system, highlighting a shift towards a more taxpayer-friendly and simplified regime.
At the core of these changes is the introduction of a new Income Tax Bill, slated to be introduced in parliament the following week. Finance Minister Nirmala Sitharaman emphasized the government’s “trust first, scrutinize later” approach, indicating a desire to streamline the tax system and foster a more transparent environment.
The new framework aims to simplify the existing Income Tax Act, making it easier for individuals and businesses to understand and comply with. A key feature is the reduction of income tax for the middle class. Individuals earning up to ₹12 lakh (₹12.75 lakh for salaried taxpayers with a standard deduction of ₹75,000) will now pay no income tax at all.
Sandeep Chilana, Managing partner at CCLaw, welcomed the overhaul but cautioned that the true test will be its effectiveness in simplifying compliance. “A complete overhaul of the Income Tax Act is a bold step, but the real question is whether it will truly simplify compliance or just reorganize complexities. If the new law can bring predictability, reduce disputes, and ease tax governance, it will be a game-changer. Though, businesses and professionals will be watching closely to see how it handles legacy issues like retrospective taxation, complex exemptions, and litigation-heavy provisions. The success of this reform will depend on how effectively it balances revenue needs with a taxpayer-friendly approach,”
he said.
The Budget also includes a modified income tax time limit, extended from two years to four years.
The government’s focus seems clear: to create a more efficient and transparent tax system that encourages investment and growth while providing greater relief to taxpayers. The success of this ambitious reform will depend on its implementation and the government’s ability to address potential challenges.
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Income tax Budget 2025 LIVE: Reducing burden on tax compliance
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Taxpayers to be allowed to claim annual value of two self-occupied properties as nil without any condition.
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