Budget 2025 Key Announcements: New tax bill, income tax slab, ITR extension, more from FM Nirmala Sitharaman. Full list
Budget 2025 Key Announcements: FM Nirmala Sitharaman announced a new tax bill, changed income tax slab, ITR extension, and more in Budget 2025. We take a look at the full list of key announcements.
Budget 2025 Key Announcements: Finance Minister Nirmala Sitharaman presented the Union Budget 2025-26 in the Parliament on February 1. This was her record eighth budget presented under Prime Minister Narendra Modi-led government's third term i.e. Modi 3.0.
In her speech, Sitharaman said the Budget aims at “transformative reforms” in six key areas — financial sector, mining, power sector, regulatory, taxation, and urban development reforms.
Key Announcements by FM Nirmala Sitharaman in Budget 2025
- FY25 revised capex at ₹10.18 lakh crore.
- Sitharaman said that a New Income Tax Bill will be announced next week.
- She announced that no income tax is payable up to ₹12 lakh annual income under the new tax regime 2025. Further, the tax slabs will be changed across board. Salaried class with salary over ₹24 lakh will pay 30 percent tax.
- Tax return filing limit will also be increased to four years from two years.
- Tax threshold on interest for senior citizens increased to ₹1 lakh.
- TDS (Tax Deducted at Source) on rent increased to ₹6 lakh from ₹2.4 lakh.
- Remove TCS (Tax Collected at Source) on remittances for education purposes if the remittance is funded through a loan taken from a specified financial institution.
- Provision of higher TDS only in non-PAN cases.
- Threshold for TCS on remittances under the RBI's Liberalised Remittance Scheme (LRS) has been increased from ₹7 lakh to ₹10 lakh.
- The government plans to simplify and streamline the customs tariff structure.
- In addition to the seven tariff rates removed in the 2023-24 Budget, seven more rates will be eliminated, leaving only eight remaining, including a zero rate.
- Duty incidents will largely be maintained, a few items will see marginal reductions.
- Govt proposes to levy no more than one cess or surcharge and will exempt the social welfare surcharge on 82 tariff lines.
- The FM proposed full exemption of Basic Customs Duty (BCD) on cobalt powder and lithium-ion battery waste, scrap, and 12 other critical minerals.
- 37 new medicines and 13 new patient assistance programs will be included in the exemption list.
- Six life-saving medicines will be added to a list with a concessional customs duty of 5%.
- Fully extend BCD on wet blue leather. Exempt crust leather from 20% duty.
- Reduce BCD from 30% to 5% on frozen fish paste. Reduce BCD from 15% to 5% fish hydrolycates.
- BCD on interactive flat panel displays from 10% to 20% and reduce the BCD on open cell and other components for LCDs and LEDs to 5%.
- Foreign Direct Investment (FDI) in insurance for firms which invest entire premium in India raise from 74 percent to 100 percent.
- Rollout of a revamped central KYC registry taking into account the technological innovations and the global regulatory landscape.
- Ensuring faster approvals for company mergers and expand the scope of related regulations.
- On ease of doing business, the government plans to develop a modern, people-friendly, and trust-based regulatory framework.
- Revealed that an Investment Friendliness Index for states will be introduced in 2025 to encourage competitive cooperative federalism.
- Under the Financial Stability and Development Council (FSDC), a mechanism will be set up to evaluate the impact of current financial regulations and subsidiary instructions.
- Creation of a ₹1 lakh crore Urban Challenge Fund which will will cover up to 25 percent of the cost for bankable projects, with a stipulation that at least 50 percent of the funding comes from bonds, bank loans, or public-private partnerships (PPPs). Each infrastructure ministry will present a three-year list of Public-Private Partnership (PPP) projects, with a focus on three PPP proposals per ministry. An initial ₹10,000 crore has been proposed for the fiscal year 2025-26 to launch the initiative.
- Additionally, the government will provide ₹1.5 lakh crore in interest-free loans for capital expenditure and offer incentives to encourage reforms.
- Another 40,000 units to be completed in FY26.
- SWAMIH Fund 2 will be established of ₹15,000 crore
- Sitharaman introduced a Nuclear Energy Mission to accelerate India's shift towards clean energy, aiming to develop at least 100 GW of nuclear power by 2047.
- A dedicated ₹20,000 crore research and development (R&D) initiative for Small Modular Reactors (SMRs) will be launched, with the goal of having at least five indigenously developed SMRs operational by 2033.
- To support MSMSEs, government has introduced customised credit cards, a fund-of-funds (FoF) for startups, and an expanded FoF with a wider scope, to improve capital access.
- Additionally, the government will enhance the investment and turnover limits for MSMEs, increasing them by 2.5 times and 2 times, respectively, to boost their growth and operational efficiency.
- FM unveiled the Prime Minister Jan Dhanya Krishi Yojana, which will focus on 100 districts with low productivity, moderate crop intensity, and below-average credit access. It aims include — crop diversification, augmenting storage, improving irrigation, and facilitating long and short-term credit for farmers. An estimated 1.7 crore farmers are expected to benefit from these measures.
- A 6-year mission aimed at achieving self-reliance in pulses, with a special focus on tur and masoor.
- Makhana Board will also be established in Bihar. As part of the National Mission for Edible Oil & Seeds, the program also aims to strengthen domestic production and reduce dependence on imports.
- The Finance Minister stated that Kisan Credit Cards (KCC) will continue to support 7.7 crore farmers, fishermen, and dairy farmers with short-term credit access. Further, under the revised interest subvention scheme, the loan limit for KCC-backed borrowing will be raised from ₹3,000 to ₹5,000, offering enhanced financial support for agricultural activities.
- A new scheme will support design, component manufacturing, and machinery for non-leather footwear, alongside leather footwear. This initiative is expected to create 22 lakh jobs, generate ₹400 crore, and boost exports to over ₹1.1 lakh crore.
- The toy sector will see a new scheme aimed at establishing India as a global hub for toys, focusing on developing clusters, skills, and a sustainable manufacturing ecosystem for high-quality, innovative toys.
- Sitharaman said the government is prioritising the Sashakt Anganwadi and Poshan 2.0 programs, providing nutritional support to over 8 crore children, pregnant women, lactating mothers, and around 20 lakh adolescent girls in aspirational districts and the Northeast, with enhanced cost norms to boost their effectiveness.
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- Infrastructure will be expanded in 5 IITs established after 2014 to accommodate 6,500 more students, and 5 National Centres of Excellence for skilling will be set up.
- The government also plans to issue identity cards and register gig workers on the e-Shram portal, aiming to assist 1 crore workers.
- Government will incentivize states to implement reforms in electricity distribution and boost intrastate transmission capacity. To assist states, an additional borrowing allowance of 0.5 percent of GSDP will be provided, based on their progress in implementing these reforms.
- A modified version of UDAN will be launched, expanding to 120 new destinations, with the aim of accommodating an additional 4 crore passengers.
- Greenfield airports will also be developed in Bihar to further enhance connectivity.
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Business NewsBudgetNewsBudget 2025 Key Announcements: New tax bill, income tax slab, ITR extension, more from FM Nirmala Sitharaman. Full list
First Published:2 Feb 2025, 06:47 AM IST
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