Union Budget 2025 Highlights & Summary

Explore the key highlights of the Union Budget 2025, including tax reforms, fiscal deficit targets, and support for MSMEs and manufacturing. Discover how the budget aims to boost middle-class savings and consumption with significant changes in income tax and credit facilities.

INDIA NEWSBUDGET

Won India Editor

2/1/20252 min read

Introduction to Union Budget 2025

The Union Budget for the fiscal year 2025 has sparked considerable interest and discussion across various sectors of the Indian economy. As the government lays down its financial policy framework, it aims not only to manage expenses and revenues but also to stimulate economic growth and bolster public welfare. The following is a point-wise summary of the key highlights of the Union Budget 2025.

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Major Highlights of Budget 2025

1. **No Income Tax for Average Monthly Income up to ₹1 Lakh: ** To boost savings and consumption among middle-class households, the government has proposed a significant revision in the income tax slab. Individuals earning an average monthly income up to ₹1 lakh will not be liable to pay any income tax.

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2. **Nil Income Tax for Salaried Individuals up to ₹12.75 Lakh Annually: ** The new tax regime has been designed to favor the salaried class even more. With this debut plan, salaried individuals with an annual income of up to ₹12.75 lakh will enjoy a nil tax liability, enhancing their disposable incomes.

3. **Fiscal Deficit Target Adjustment: ** The projected fiscal deficit for FY-25 stands at 4.8%, with an ambitious target set to reduce it to 4.4% in FY-26. This indicates a meticulous approach by the government to manage its fiscal health while ensuring economic stability.

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Support for Small and Medium Enterprises

4. **Credit Enhancement for MSMEs: ** There is a notable boost for Micro, Small, and Medium Enterprises (MSMEs) as the government increases the credit guarantee cover from ₹5 crore to ₹10 crore. This increase aims to empower MSMEs, aiding their growth and sustainability through better financial access.

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5. **Launch of a National Manufacturing Mission: ** A significant initiative, aimed at reinforcing the manufacturing sector in India, has been introduced. This mission will cover small, medium, and large industries, encouraging the “Make in India” movement and promoting self-sufficiency.

6. **PM Svanidhi Scheme Enhancements: ** The PM Svanidhi program has been given a face-lift with enhanced loan offerings from banks. In addition, UPI-linked credit cards with a limit of ₹30,000 will foster financial inclusivity and accessibility for street vendors and small business owners.

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Conclusion

The Union Budget 2025 is a comprehensive package aimed at fostering growth in various sectors while ensuring fiscal prudence. Its commitment to middle-class welfare through tax relief, focus on MSME growth, and the enhancement of manufacturing capabilities presents an optimistic outlook for the country's economy. As we move forward, the challenge will lie in effectively implementing these policies to realize their full potential in stimulating economic growth.