Budget 2025 Updates – Tax Relief, Job Creation, and Economic Growth
Finance Minister Nirmala Sitharaman, while presenting the Union Budget 2025, announced a significant tax relief for the middle class, raising the tax exemption limit under the new regime to ₹12 lakh. This is expected to provide much-needed financial relief to salaried individuals. The finance minister also introduced a new, simplified income tax bill, set to be presented next week.
Budget 2025: Fiscal deficit target pegged at 4.4% for 2025-26
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Additionally, the budget outlines rationalization of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) to reduce compliance burdens and enhance ease of doing business. With a focus on employment and investment, the government aims to boost economic activities while ensuring that taxation remains fair and progressive.
Fiscal Deficit and Economic Outlook
A key highlight of the budget is the fiscal deficit projection, which has been set at 4.4% of GDP. The government remains committed to maintaining fiscal prudence while ensuring economic growth through policy-driven reforms and capital expenditures. The finance minister emphasized that India’s economy remains the fastest-growing among major global economies, citing strong development indicators and structural reforms.
Key Measures for MSMEs and Startups
Recognizing the role of Micro, Small, and Medium Enterprises (MSMEs) as a driving force of India’s manufacturing and export sector, the government has announced significant measures to support them. Investment and turnover limits for MSME classification will be increased by 2.5 times, allowing more enterprises to access benefits and incentives.
A ₹10,000 crore “Fund of Funds” has been introduced to provide financial support to startups, with a special focus on first-time entrepreneurs from women, Scheduled Castes, and Scheduled Tribes. The government also announced enhanced credit guarantee cover for MSMEs, helping businesses access capital with greater ease.
Healthcare and Education Expansion
In a major boost to healthcare and education, the finance minister announced 10,000 additional medical college seats for the upcoming year, with a plan to add 75,000 seats over the next five years. This move is aimed at addressing India’s growing healthcare workforce needs and improving medical education infrastructure.
Additionally, 23 IITs have expanded their student capacity to over 1.35 lakh seats, and a Centre of Excellence for Education will be set up with an outlay of ₹500 crore.
Infrastructure and Aviation Development
The Modified ‘Udaan’ Scheme will be launched to enhance regional connectivity, benefiting 120 new destinations. This initiative will support helipads and smaller airports in hilly and remote areas, improving accessibility and economic opportunities.
Further, Greenfield airports in Bihar have been announced to meet the state’s future aviation needs. This move aligns with the government’s vision to strengthen the country’s transportation infrastructure.
Inflation Control and Duty-Free Goods
To curb inflation and lower household expenses, the government has introduced duty exemptions on 36 life-saving drugs. Additionally, nine essential goods have been added to the duty-free sector to reduce costs for consumers.
Boost to Agriculture and Rural Development
With agriculture being a critical component of India’s economy, PM Dhandhanya Krishi Yojna has been introduced to cover 100 districts with low productivity, focusing on increasing agricultural output and storage facilities. Special support for makhana (fox nut) farmers in Bihar will be provided through a dedicated Makhana Board, which will offer training and market support.
A national pulses program has also been launched, targeting crops such as urad, tuar, and masoor, to enhance domestic production and reduce dependency on imports.
India Post to Become Public Logistics Giant
The government has announced plans to transform India Post into a large-scale public logistics provider. This move is expected to improve last-mile delivery services and enhance India’s e-commerce and postal infrastructure.
Innovation and Digital India Focus
A dedicated ₹20,000 crore fund has been allocated to promote innovation in partnership with the private sector. The government will continue its focus on artificial intelligence, fintech, and digital inclusion, ensuring India remains a global leader in technology-driven growth.
Budget 2025 balances economic growth with fiscal prudence while addressing tax relief, employment generation, and infrastructure expansion. With policies focused on MSMEs, startups, healthcare, education, and agriculture, the government aims to create a robust and resilient economy.
With the announcement of zero income tax up to ₹12 lakh, increased public investment, and strategic economic policies, Budget 2025 sets the stage for sustained growth while keeping the welfare of citizens at its core.
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