The Union Budget for the fiscal year 2025-26, presented on February 1, 2025, introduces several significant changes aimed at stimulating economic growth, enhancing public welfare, and promoting sustainable development. Below are the key highlights:
Taxation Reforms
- Income Tax Relief: The budget proposes a zero income tax rate for individuals earning up to ₹12 lakh annually under the new tax regime. Incomes above this threshold will be taxed according to revised slabs. The old tax regime remains unchanged.
- TDS and TCS Adjustments: The threshold for Tax Deducted at Source (TDS) on interest for senior citizens has been increased from ₹50,000 to ₹1 lakh. Additionally, the annual limit for TDS on rent has been raised from ₹2.4 lakh to ₹6 lakh.
- National Savings Scheme (NSS) Withdrawals: Withdrawals from the NSS made on or after August 29, 2024, will be exempt from tax.
- Extended Filing Deadline: The timeframe to file updated income tax returns has been extended from two to four years.
Agricultural Initiatives
- Prime Minister Dhan-Dhaanya Krishi Yojana: A new scheme aimed at enhancing agricultural productivity and farmer welfare.
- Enhanced Credit Access: The budget facilitates short-term loans of up to ₹5 lakh for 7.7 crore farmers, fishermen, and dairy farmers through the Kisan Credit Card (KCC) scheme.
- Pulses Self-Reliance Mission: A six-year mission focusing on increasing the production of pulses, particularly Tur, Urad, and Masoor, to achieve self-sufficiency.
- Makhana Board Establishment: A dedicated board will be set up in Bihar to promote the cultivation and marketing of makhana (fox nuts).
Science and Innovation Investments
- Research and Development Allocation: An allocation of ₹20,000 crore has been made to implement a private sector-driven research, development, and innovation initiative.
- Prime Minister’s Research Fellowship: The program will provide 10,000 fellowships for technological research in premier institutions like IITs and IISc.
- Crop Gene Bank: The establishment of a second gene bank, housing 10 lakh germplasm lines, aims to ensure future food and nutritional security.
Export Promotion Measures
- Electronics and EV Incentives: Exemptions will be granted for open cells used in LED/LCD TVs, looms for textiles, and capital goods for lithium-ion batteries used in mobile phones and electric vehicles.
- Maintenance, Repair, and Overhaul (MRO) Support: A 10-year exemption will be provided on goods used for shipbuilding and ships meant for breaking. The time limit for exporting railway goods imported for repairs will also be extended.
- Trade Facilitation: New provisions set time limits for finalizing provisional assessments and allow for voluntary declaration of material facts after clearance and duty payment, with interest but without penalty. The Import General Customs Rules (IGCR) have been amended to extend the time limit to one year and permit quarterly statement filings instead of monthly ones.
- Leather Industry Support: Wet blue leather will be fully exempted from basic customs duties to promote domestic consumption and enhance exports.
These measures reflect the government’s commitment to fostering economic growth, supporting various sectors, and providing relief to taxpayers.
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