Budget 2025: No Income Tax Up To Rs 12 Lakh; Relief for Citizens

On February 1, Union Finance Minister Nirmala Sitharaman presented her eighth consecutive Union Budget for 2025 in the Lok Sabha. Sitharaman declared that salaried individuals will not have to pay income tax on income up to ₹12.75 lakh under the new tax regime, among other measures.

Key adjustments to income tax slabs in Budget 2025

FM Nirmala Sitharaman unveiled a new tax regime that includes 0% income tax for income up to ₹12 lakh. Budget 2025 provided much-needed relief for India’s middle class, including zero tax on incomes up to ₹12 lakh and lower income tax rates.

• Income of up to Rs 4 lakh is tax-free under the amended slabs.
• Between Rs 4 and Rs 8 lakh, the tax will be 5%.
• Between Rs 8 and Rs 12 lakh, it will be 10%.
• Between Rs 12 lakh and Rs 16 lakh, it will be 15%.
• Between Rs 16 lakh and Rs 20 lakh, it will be 20%.
• Between Rs 20 lakh and Rs 24 lakh, it will be 25%.
• Above Rs 24 lakh, it will be 30%.

Budget Speech 2025 Key Takeaways

Here are some significant takeaways from FM Nirmala Sitharaman’s Budget speech.

• Fiscal deficit: The fiscal deficit for FY25 is set at 4.8%, while the fiscal deficit for FY26 is expected to be 4.4%.
• The Jan Vishwas Bill 2.0 will be proposed to decriminalize over 100 sections. The investment-friendly index of states will be launched in 2025.
• Revised tariff rates: Propose the reduction of seven tariff rates in addition to those abolished in the previous budget. Only eight tariff rates will remain after the new shift.
• FM allocated ₹1.5 lakh crore for 50-year interest-free loans to states for capex and infrastructure.
• FM declared that 36 live savings pharmaceuticals and medicines are totally exempt from basic customs charges.

FYI Budget Other Allocations

• Aatmanirbharta’ in pulses: To increase ‘aatmanirbharta’ or pulse self-reliance, the government launched a 6-year mission with a special focus on tur, urad, and masoor, emphasizing developing and marketplace accessibility of climate resilient seeds, improving protein content, and increasing productivity, among other things.
• FM Sitharaman unveiled a new initiative on Saturday that will grant term loans up to ₹2 crore to 5 lakh first-time entrepreneurs, including women, Scheduled Castes, and Scheduled Tribes, over the next 5 years.
• Nirmala Sitharaman declared while delivering the Union Budget 2025 that a modified ‘UDAN’ project will be implemented to improve regional connectivity to 120 new destinations and carry four crore people over the next ten years. The program will also fund helipads and micro airports in hilly, ambitious, and Northeast area districts.
• Greenfield airports in Bihar will be developed to satisfy the state’s future demands. These will be in addition to the increase of the capacity of Patna airport and a brownfield airport at Bihta.
• Medical seats: Finance Minister Nirmala Sitharaman however announced that 10,000 additional seats will be introduced in medical colleges and hospitals next year, with the goal of adding 75,000 seats over the next five years.
• Senior persons can now get a tax deduction of ₹1 lakh, up from ₹50,000 previously.
• Government to create top 50 tourist sites. In her budget speech, Finance Minister Nirmala Sitharaman indeed stated that the central government will collaborate with states to develop 50 tourism destinations across the country through a challenging method.