As part of the Budget for 2025-26, Finance Minister Nirmala Sitharaman announced that contributions of up to Rs 50,000 per year towards the NPS Vatsalya scheme, a children's welfare scheme, will be eligible for tax exemption. This move aims to make the scheme more appealing, with the tax benefits also available to regular NPS accounts. The number of enrolments in the scheme is expected to increase with this announcement, providing a secure and prosperous financial future for minors.
The Finance Minister, in her Budget 2025 speech, announced significant changes in taxation including a nil tax slab limit of Rs 12 lakh, increased from Rs 7 lakh, and an extended time limit of 4 years to file an updated income tax return. The threshold for TDS deduction on rent has also been raised from Rs 2.4 lakhs to Rs 6 lakhs while the exemption limit for TCS on remittances has been increased from Rs 7 lakhs to Rs 10 lakhs. Additionally, TCS on sale of goods will be omitted to ease compliance difficulties.
During her Union Budget 2025 speech, Finance Minister Nirmala Sitharaman announced that no income tax will be payable on income up to Rs 12 lakh, providing significant relief to taxpayers, especially the middle class. However, this exemption only applies if a taxpayer takes relief under various sections of the income tax act. No major announcements were made for the railway sector, as the budget focuses more on increasing allocations for railways over highways.
In her eighth consecutive Union Budget, Finance Minister Nirmala Sitharaman has announced a major relief for the middle class in India. People with an annual income of up to Rs 12 lakh will not have to pay any income tax, owing to a tax rebate and the availability of a standard deduction of Rs 75,000 under the new tax regime. However, tax experts state that individuals with zero tax liability are still required to file an income tax return, leading to a cleaner financial record.
With the announcement of the new tax regime, Finance Minister Nirmala Sitharaman has announced significant changes to the slabs and rates to benefit all taxpayers. Under the new system, taxpayers with normal income up to Rs 12 Lakhs will not have to pay any taxes, and those with income up to Rs 4 Lakhs will be exempted. The time limit for filing returns has also been extended to 4 years.
Despite Finance Minister Nirmala Sitharaman's tax cuts for the middle class in Budget 2025, India's stock market remained flat with the Sensex down 0.37% and Nifty down 0.42%. The market awaits a boost in infrastructure and consumer spending as government expenditure has fallen. However, FMCG companies may see an upside with an increase in disposable income for individuals and a focus on the sector in the Budget. Meanwhile, industries such as defence and railways are closely tracking the Budget announcements.
The second Budget under the BJP government led by PM Narendra Modi presented by Finance Minister Nirmala Sitharaman has a slew of surprises for taxpayers. The biggest takeaway is the massive income tax relief with an increased tax rebate level of Rs 12 lakh annually and reduced tax slabs. Despite this, the government plans to maintain fiscal discipline and reduce the fiscal deficit to 4.4% in the next financial year. However, there is a notable shift away from recent budgets with a decrease in capital expenditure growth and a focus on employment generation by boosting specific sectors.
Zakia Jafri, a survivor of the Gulberg Society massacre during the 2002 Gujarat riots, has died at the age of 86 due to age-related issues. She has been a prominent figure in the fight for justice for the victims of the riots and had filed a plea in the Supreme Court against the clean chit given to then Gujarat CM Narendra Modi. The FM has announced income tax rebates and lower tax rates for various income categories.
Finance Minister Nirmala Sitharaman presented the Union Budget for 2025 and announced significant changes in the income tax slabs, with a hike in the exemption limit to Rs 12 lakh per annum. The budget also focuses on skilling initiatives, such as National Centers of Excellence and expansions in AI and IT education. The real estate sector also received a boost with measures like allowing taxpayers to claim two self-occupied properties.
In a major move, the finance minister has announced an increase in the income tax rebate limit from Rs 7 lakh to Rs 12 lakh, providing significant savings for high earners. However, for those earning above Rs 12 lakh, taxes will be applicable as per slab rates under the new tax regime, with a 5% tax on income between Rs 4 lakh to 8 lakh, 10% on income between Rs 8 lakh to 12 lakh, and 15% between Rs 12 lakh to 16 lakh. The FM has also proposed a sharp cut in tax rates for incomes between Rs 15 lakh and Rs 24 lakh, with the 30% rate now only applicable for income above Rs 24 lakh.