Budget 2025: 5 Powerful Takeaways from FM’s Speech
The Union Budget 2025 has set the stage for economic growth, with a sharp focus on tax relief, employment, and fiscal discipline. Finance Minister Nirmala Sitharaman presented the budget for the upcoming financial year, marking the second budget of the Modi government’s third term. Here are the five major takeaways:
1. Big Tax Cuts – More Money for Taxpayers
The budget brought a massive income tax relief, surprising many. The tax rebate level has been raised from Rs 7 lakh to Rs 12 lakh annually, putting more money into taxpayers’ hands. Additionally, the highest tax slab of 30% will now apply only to those earning over Rs 24 lakh per year. This move is expected to boost spending and economic activity, ultimately driving job creation.
2. Fiscal Discipline Maintained Despite Revenue Loss
Despite the government foregoing nearly Rs 1 lakh crore in revenue due to tax cuts, the fiscal deficit will be reduced further to 4.4% of GDP in 2025-26. This ensures financial stability while preventing excessive borrowing, which could lead to higher interest rates or inflation.
3. Shift Away from Aggressive Capital Expenditure
While capital expenditure (capex) has been a major focus in previous budgets, this time, the government has slowed down its pace. The capex target for the current year was missed by Rs 1 lakh crore, and the allocation for the next year shows only a marginal increase. However, it remains historically high, ensuring continued investment in infrastructure.
4. Employment Generation Takes Center Stage
The budget highlights a renewed focus on job creation, particularly in labor-intensive sectors like textiles and leather. While previous policies like the Production Linked Incentive (PLI) scheme focused on capital-heavy industries, this shift aims to generate employment and support economic inclusivity.
5. Regulatory Reforms – A Step Towards Ease of Business
A new committee will be formed to identify and implement regulatory reforms that make business operations smoother in India. While this is a much-needed step, critics argue that it comes late, arriving 11 years after the Modi government’s first term.
Conclusion
The Budget 2025 strikes a balance between fiscal prudence and economic stimulation. The tax cuts will offer relief to the middle class, while regulatory changes and employment-focused policies aim to create a sustainable growth path. With a cautious approach to capital expenditure, the government is ensuring financial discipline while keeping an eye on long-term development.
This budget sets the tone for India’s economic trajectory, making it a crucial milestone in the country’s financial landscape.