Union Budget 2025 presented by FM Nirmala Sitharaman

Key Announcements Union Budget 2025 presented by FM Nirmala Sitharaman

The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman, introduces a series of initiatives aimed at fostering inclusive development, bolstering economic growth, and enhancing the welfare of various societal segments.

Key Announcements Union Budget 2025

• Agriculture and Rural Development:

  • Launch of the Dhan Dhanya Yojana in 100 districts to promote agricultural prosperity.
  • Introduction of a special six-year mission focusing on pulses like Tur, Urad, and Masoor to boost production and self-sufficiency.
  • Establishment of a Makhana Board in Bihar to support and regulate the makhana industry.
  • Commitment by central agencies to purchase pulses for the next four years, ensuring price stability and farmer support.
  • Collaboration with states to implement new schemes aimed at enhancing vegetable and fruit production.
  • Development initiatives targeting the marine sector to support fisheries and related industries.
  • Increase in the Kisan Credit Card limit to ₹5 lakh, providing farmers with greater financial flexibility.
  • Plan to set up a urea plant in Assam to meet the fertilizer demands of the northeastern region.
  • Kisan Credit Card limit increased from ₹3 lakh to ₹5 lakh. Extension of Jal Jeevan Mission till 2028.

• Infrastructure and Urban Development:

  • Transformation of India Post into a major logistics organization to enhance parcel delivery and e-commerce logistics. Provision of interest-free funds to states to accelerate infrastructure projects. Allocation of a INR 1 lakh crore fund dedicated to urban development, focusing on smart cities and sustainable urbanization.  Urban Challenge Fund of INR 1 lakh crore to support urban development.
  • Development of greenfield airports in Bihar, in addition to the expansion of Patna airport.

• Industry and Manufacturing:

  • Launch of a National Manufacturing Mission to position India as a global manufacturing hub. Special schemes introduced for the footwear and leather sectors, aiming to generate 22 lakh new jobs under the Leather Scheme. Initiatives to establish India as a global hub for toy production, promoting indigenous manufacturing. so INR 20,000 crore allocated for Private Sector R&D.
  • Foreign Direct Investment limit in the insurance sector raised to 100%, provided the entire premium is invested in India. Revamped KYC Registry to be introduced.

• Education and skill development:

  • Increased emphasis on incorporating Indian languages into the education system to promote cultural heritage.
  • Plan to establish more Indian Institutes of Technology (IITs) to expand access to quality technical education.
  • Additional infrastructure in five IITs set up after 2014, with IIT Patna to be expanded. 10,000 more seats to be added in medical colleges next year; 75,000 seats over the next five years.
  • Proposal to add 75,000 new seats in the medical field over the next five years to address healthcare needs.
  • Establishment of special research centers dedicated to Artificial Intelligence (AI) to foster innovation and technological advancement. INR 500 crore allocated for Centre for Excellence in AI

• Financial Sector Reforms:

  • Introduction of a special credit card tailored for small businesses to facilitate easier access to credit.
  • Implementation of UPI-linked cards for small vendors, with a credit limit set at ₹30,000, promoting digital transactions.
  • Proposal to raise the Foreign Direct Investment (FDI) limit in the insurance sector to 100%, encouraging greater foreign participation.
  • Simplification of the RE-KYC process to make financial transactions more user-friendly.
  • Introduction of a new, simplified Income Tax law aimed at reducing complexities and improving compliance.

• Taxation and Fiscal Policies:

  • Simplification of Tax Deducted at Source rates to make tax compliance easier. Significant tax relief measures for senior citizens, including increasing the tax exemption limit to INR 1 lakh. Increase in the TDS exemption limit on rent to INR 6 lakh, benefiting landlords and tenants alike. Removal of penalties on delayed Tax Collected at Source payments to ease taxpayer burden.
  • Top 50 tourist destinations to be developed, with a focus on Buddha-related sites.  “Heal in India” initiative to promote medical tourism.

• Healthcare and Social Welfare:

  • Launch of a health insurance scheme targeting small workers to provide them with essential health coverage. Development of 40,000 housing units under the SWAMIH scheme to address urban housing shortages. Social welfare scheme for gig workers.

• Energy and Environment:  

  • Increased focus on nuclear energy with a vision extending to 2047, including the introduction of a special scheme to promote this clean energy source. Proposal to remove customs duties on waste and scrap of critical minerals to support the manufacturing sector.

• Tourism and Culture:

  • Development of 52 new tourist destinations in collaboration with states to boost domestic and international tourism. Initiatives to develop Buddha-related sites, promoting cultural heritage and tourism. Special schemes aimed at preserving Indian scripts, ensuring the protection of linguistic heritage.

• Customs & Tariff:

  • Rationalization of customs tariff structure. 36 life-saving drugs exempt from customs duty. 5% customs duty imposed on six life-saving drugs.

Direct & Indirect Tax Announcements

1. Income Tax Reforms:
   • A new Income Tax Bill to be introduced next week, aimed at simplification. Personal Income Tax Reforms focused on middle-class taxpayers. NIL income tax up to ₹12 lakh. Revised income tax slabs to be announced.  Revised Income Tax Slabs: The new income tax slabs are as follows:

• • • Income up to INR 4,00,000: No tax
    • INR 4,00,001 to INR 8,00,000: 5%
    • INR 8,00,001 to INR 12,00,000: 10%
    • INR 12,00,001 to INR 16,00,000: 15%
    • INR 16,00,001 to INR 20,00,000: 20%
    • INR 20,00,001 to INR 24,00,000: 25%
    • Above INR 24,00,000: 30%

• Tax Exemption Limit: The FM proposed that individuals with an annual income of up to INR 12 Lakhs will not be required to pay any income tax. For salaried individuals, the standard deduction has been increased to INR 70,000.
• TDS & TCS Reforms: TDS & TCS rationalized to simplify tax compliance. TDS on rent limit raised from INR 240,000/- to INR 6,00,000/- TDS exemption for senior citizens increased from INR 50,000 to INR 1,00,000/- and TCS on remittances for education purposes was removed.
• Other Tax Reforms: Updated Return time limit extended from 2 years to 4 years. Liberalized Remittance Scheme limit increased from INR 7,00,000/- to INR 10,00,000/-

Key Documents for your Full Read, the Budget 2025

The Union Budget 2025-2026, presented by Finance Minister Nirmala Sitharaman on February 1, 2025, encompasses several key documents that provide comprehensive insights into the government’s financial plans and policies. Here are the primary documents for your reference:

1. Finance Bill 2025: This bill outlines the legal amendments required to implement the budget’s financial proposals. Finance Bill 2025

2. Finance Minister’s Speech: The speech delivered by the Finance Minister during the budget presentation, detailing the government’s economic agenda and key initiatives. Finance Minister’s Speech

3. Memorandum Explaining the Provisions in the Finance Bill: This document provides detailed explanations of the provisions included in the Finance Bill. Memorandum Explaining the Provisions in the Financial Bill

4. Key to Budget Document, 2025: A guide that explains the structure and components of the budget documents, aiding in their understanding.Key to Budget Document, 2025

5. Budget Highlights (Key Features): A summary of the main features and initiatives proposed in the budget. Budget Highlights (Key Features)

6. Expenditure Budget (Full): A comprehensive account of the government’s expenditure across various ministries and departments. Expenditure Budget (Full)

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