Nirmala Sitharaman presents Union Budget 2025: Speech Key Points
The budget introduces revised tax slabs and rates to reduce the tax burden on the middle class and benefit all taxpayers.
New Delhi: On February 1, 2025, Finance Minister Nirmala Sitharaman presented her eighth consecutive Union Budget in Parliament. This budget aims to address economic growth, fiscal discipline, and relief for the middle class. Here are the key highlights:
The budget focuses on reviving economic growth while maintaining fiscal discipline. The Economic Survey predicts a growth rate of 6.3% to 6.8% for the financial year 2025-26.
Income Tax Relief
Significant relief in income tax rates and slabs is anticipated, especially for the lower-middle class. This move aims to boost consumption and ease inflationary pressure on households.
Personal Income Tax Reforms
Zero Income Tax for Earnings up to Rs 12 Lakh
The new tax regime offers a 'Nil tax' slab for individuals earning up to Rs 12 lakh. For salaried taxpayers, there is an additional standard deduction of Rs 75,000, making the effective tax-free income limit Rs 12.75 lakh. This reform aims to leave more money in the hands of taxpayers, boosting household consumption, savings, and investment.
Old Tax Slabs and Rates
| INCOME RANGE | TAX RATE |
| 0-3 Lakh rupees | Nil |
| 3-7 Lakh rupees | 5% |
| 7-10 Lakh rupees | 10% |
| 10-12 Lakh rupees | 15% |
| 12-15 Lakh rupees | 20% |
| Above 15 Lakh rupees | 30% |
New Tax Slabs and Rates
The budget introduces revised tax slabs and rates to reduce the tax burden on the middle class and benefit all taxpayers. The new tax structure is as follows:
| INCOME RANGE | TAX RATE |
| 0-4 lakh rupees | Nil |
| 4-8 lakh rupees | 5% |
| 8-12 lakh rupees | 10% |
| 12-16 lakh rupees | 15% |
| 16-20 lakh rupees | 20% |
| 20-24 lakh rupees | 25% |
| Above 24 lakh rupees | 30% |
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Agriculture and Employment
The budget includes incentives to boost the agricultural sector, employment schemes, and support for MSMEs. The PM Dhan Dhyan Krishi Yojana was launched to support 100 districts with low yields, benefiting 1.7 crore farmers.
Infrastructure Development
Increased focus on infrastructure development is expected to support economic growth. The budget outlines reforms in urban development, mining, financial sector, power, and regulatory frameworks.
Budget on Jal Jeevan Mission
The total budget outlay for Jal Jeevan Mission has been enhanced to Rs 67,000 Crore. The mission stands extended until 2028.
Smt. Nirmala Sitharaman stated that 15 crore households representing 80 per cent of India’s rural population have benefitted by the Jal Jeevan Mission since 2019. She added that access to potable tap water connections is provided under this Mission and in the next three years the target is to achieve 100 per cent coverage.
Jal Jeevan Mission’s focus will be on the quality of infrastructure and O&M of rural piped water supply schemes through “Jan Bhagidhari”. Separate MoUs will be signed with states/UTs, to ensure sustainability and citizen-centric water service delivery, informed Smt. Sitharaman.
Proposes to Remove Seven Customs Tariff rates for industrial goods
Union Budget 2025-26 presented by Union Minister for Finance and Corporate Affairs, Smt Nirmala Sitharaman in parliament today, focuses its customs proposals on rationalizing tariff structure and addressing duty inversion. The Minister said that the proposals will also support domestic manufacturing and value addition while promoting exports, facilitating trade and providing relief to common people.
The Budget also proposes to levy not more than one cess or surcharge. This will exempt Social Welfare Surcharge on 82 tariff lines that are subject to a cess.
Other Key Points
Prime Minister Dhan-Dhaanya Krishi Yojana - Developing Agri Districts Programme
- The programme to be launched in partnership with the states, covering 100 districts with low productivity, moderate crop intensity and below-average credit parameters, to benefit 1.7 crore farmers.
Building Rural Prosperity and Resilience
- A comprehensive multi-sectoral programme to be launched in partnership with states to address under-employment in agriculture through skilling, investment, technology, and invigorating the rural economy.
- Phase-1 to cover 100 developing agri-districts.
Aatmanirbharta in Pulses
- Government to launch a 6-year “Mission for Aatmanirbharta in Pulses” with focus on Tur, Urad and Masoor.
- NAFED and NCCF to procure these pulses from farmers during the next 4 years.
Comprehensive Programme for Vegetables & Fruits
- A comprehensive programme to promote production, efficient supplies, processing, and remunerative prices for farmers to be launched in partnership with states.
Makhana Board in Bihar
- A Makhana Board to be established to improve production, processing, value addition, and marketing of makhana.
National Mission on High Yielding Seeds
- A National Mission on High Yielding Seeds to be launched aiming at strengthening the research ecosystem, targeted development and propagation of seeds with high yield, and commercial availability of more than 100 seed varieties.
Fisheries
- Government to bring a framework for sustainable harnessing of fisheries from Indian Exclusive Economic Zone and High Seas, with a special focus on the Andaman & Nicobar and Lakshadweep Islands.
Mission for Cotton Productivity
- A 5-year mission announced to facilitate significant improvements in productivity and sustainability of cotton farming, and promote extra-long staple cotton varieties.
Enhanced Credit through KCC
- The loan limit under the Modified Interest Subvention Scheme to be enhanced from Rs 3 lakh to Rs 5 lakh for loans taken through the KCC.
Urea Plant in Assam
- A plant with annual capacity of 12.7 lakh metric tons to be set up at Namrup, Assam.