Summary
The Union Budget 2025, to be presented by Finance Minister Nirmala Sitharaman on February 1, is expected to focus on tax relief, infrastructure, sustainable energy, and digital innovation. With hopes for income tax benefits, increased capital spending, and GST modernization, stakeholders across sectors await key policy measures. Following the NDA government's re-election in 2024, this will be the second full budget of its term, aiming to drive economic recovery and growth.
Various business leaders and experts believe the following key point should appear in the budget for 2025.
Union Budget 2025 speech—key details
The finance minister, Nirmala Sitharaman, plans to address Parliament through her annual speech beginning at 11 am on February 1, 2025. The upcoming budget will be her second full-fledged budget since Narendra Modi took the Prime Minister role as the NDA Government obtained its re-election in 2024.
Key Expectations for Budget 2025
No Tax Up to ₹10 Lakh, 25% Tax for ₹15-20 Lakh Income
The Union Budget 2025 is expected to introduce significant tax reforms, including exempting annual incomes up to Rs 8-10 lakh from taxation and introducing a 25% tax slab for incomes between Rs 15 lakh and Rs 20 lakh. Experts anticipate an increase in the standard deduction limit to Rs 1.2 lakh for both old and new tax regimes.
The government is exploring options to make income up to Rs 10 lakh tax-free while reducing the highest tax rate from 30% to 25% for middle-class earners. These changes aim to boost disposable income and stimulate consumer spending.
Tax Incentives for Renewable Energy
The solar, wind and energy storage sectors expect government funding through tax incentives that will advance India's green technology development. The Founder and Director of Recyclekaro, Rajesh Gupta, advocated for policies that would help clean energy innovation and domestic green sector manufacturing in India.
AI Research and Digital Innovation
AI tools continue gaining popularity so government experts expect major funding for future AI research projects. Workruit chief executive Manikanth Challa recommends using AI to strengthen career program development and recruitment tools, which will improve workforce development and hiring systems.
Tax Revisions to Boost Consumer Spending
According to Manish Kumar, who serves as CEO of KredX, raising the tax-free threshold to ₹10 lakh in tax structures would stimulate consumer buying activities. By increasing Section 80C deductions, the government could improve long-term saving opportunities that include PPF, ELSS and life insurance.
Incentivizing MSMEs
According to Abhishek Jain, who serves as National Head of Indirect Tax at KPMG, MSMEs are indispensable to India’s economic progression. The motivation of small businesses through incentives will increase their impact on economic statistics and contribute to country-wide development.
Strengthen the electronics and semiconductor sectors
Ashok Rajpal from Ambrane India urged government support to strengthen the electronics and semiconductor sectors in India. The Production Linked Incentive (PLI) scheme should obtain increased support because this scheme promotes technological improvements, thus leading to stronger exports and additional employment opportunities in these sectors.
Removing Financial Barriers in Solar Investments
N.P. Ramesh of Orb Energy recommended that the government bring back 100% accelerated depreciation benefits for solar investments because it lets businesses recover their solar investment costs more quickly, thus making solar power more attractive for adoption.
Reforming Tax Framework for Real Estate
Real estate sector success demands a simplified tax structure, according to Parag Munot of Kalpataru, who leads as Managing Director. Making exclusive tax incentives for home loan purchases creates an opportunity to boost economic growth rates.
GST on Large TVs
Videotex Director Arjun Bajaj proposed to the government that they eliminate the 28% GST on TVs larger than 40 inches. This essential status of these household items creates potential benefits for industry sales, which would occur if the tax disappeared.
Duty Cuts and Financial Barriers
According to Sanjay Notani from Economic Laws Practice, duty cuts on US-oriented products might be introduced in this budget because of the change in US administrative structure. Notani promoted budgetary strategies to decrease financial obstacles that prevent people from adopting solar power systems as clean energy solutions.
Focus on EV Sector Growth
Shreyas Shibulal, Founder and CEO of Numeros Motors, outlined the need for targeted support for the electric vehicle (EV) ecosystem. Extending initiatives like FAME, revising GST tax structures, and promoting local manufacturing and advanced battery technologies could propel India to the forefront of the global EV revolution.
Boosting Digital Infrastructure
Rohit Manglik emphasized to the government that digital infrastructure funding requires enhancement because it supports educational and technological innovations according to the guidelines established in NEP 2020.
Measures for Sustainable Businesses
Shashank Noronha from TABBSZ proposed that India should establish environmental product tax incentives alongside waste management funding to develop sustainable business industries.
Cybersecurity and 5G Infrastructure
The digital expansion of India needs both robust 5G infrastructure investments and cybersecurity measures, according to Arijeet Talapatra in his role as CEO of Itel India. The expansion of PLI programs with semiconductor production, battery technology and display unit manufacturing will boost India's international market position.
Simplifying Capital Gains Tax
The capital gains tax structure should become simpler, according to Sumit Kochar, who serves as Managing Partner at Dolce Vita Legal Advisors for unlisted securities. India will enhance its appeal for environmentally friendly investments through streamlined regulations that govern green bonds and ESG funds.
Health Insurance and Consumer Protection in E-Commerce
The healthcare industry, alongside e-commerce, seeks legislative changes regarding the protection of consumers. Pankaj Nawani, who serves as CEO of CarePal Secure, asked for insurance distribution cost reductions as one solution. To enable the tapping of rural market potential and expanding digital infrastructure, Swati Bhargava from CashKaro requested better consumer protection laws.
What is the budget date for 2025?
What is the new tax regime in 2025?
Is the market open on 1st February?
What is the date of Budget every year?
Stay tuned to get information about the upcoming budget 2025!
