As India gears up for the Union Budget 2025, all eyes are on Finance Minister Nirmala Sitharaman’s presentation scheduled for February 1, 2025.
Union Budget 2025 Highlights
This budget is particularly significant as it marks the second full budget of the Modi 3.0 government. With India’s GDP growth projected at 7.3% for FY2024-25, experts anticipate focused measures to maintain this momentum.
The budget is expected to prioritize fiscal consolidation while addressing key sectors like infrastructure, technology, and social welfare.
Potential tax reforms, including modifications to the new tax regime introduced in 2023, are anticipated for middle-class taxpayers.
The economic survey 2024-25 suggests strong fundamentals, with inflation targeted at 4.5% and fiscal deficit aimed below 5.8% of GDP, setting the stage for transformative budget announcements.
Source: Income Tax Budget 2025 Expectations. The Economic Times.
Union Budget Expectations: Tax Reforms and Income Tax Changes in 2025
The upcoming budget is expected to bring significant changes to India’s tax structure, particularly focusing on simplifying the tax regime and providing relief to middle-class taxpayers.
Expected Tax Slab Modifications
| Income Range (₹) | Current Rate | Expected Rate |
|---|---|---|
| 0-3 lakh | Nil | Nil |
| 3-6 lakh | 5% | 5% |
| 6-9 lakh | 10% | 8% |
| 9-12 lakh | 15% | 12% |
| 12-15 lakh | 20% | 18% |
| Above 15 lakh | 30% | 25% |
The new tax regime, introduced in 2023, is expected to undergo further refinements.
Industry experts anticipate an increase in the standard deduction for salaried professionals from the current ₹50,000 to ₹75,000.
Additionally, there are discussions about introducing a zero-tax bracket for individuals earning up to ₹10 lakh annually, potentially benefiting over 75% of taxpayers.
For salaried professionals, the impact could be substantial:
- Enhanced standard deduction benefits
- Simplified tax filing procedures
- Additional benefits for health insurance premiums
- Special allowances for work-from-home expenses
Union Budget 2025 | Why Nirmala Sitharaman should put money into middle class hands | THE WEEK
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Hari Balaji, Partner in Technology Consulting at EY India, explained the progress and future directions of the IndiaAI Mission. According to him, the IndiaAI Mission, with a significant allocation of Rs 10.4k crore, aims to enhance AI computing capacity, research, and innovation.
Recent surveys indicate that 68% of salaried professionals prefer the new tax regime, with its simpler structure and lower effective tax rates.
The budget is expected to strengthen this trend by introducing more taxpayer-friendly measures and digital compliance tools.
Union Budget 2025 Expectations: Impact on Indian Stock Market and Investments
The impact of Union Budget 2025 on the Indian stock market is expected to be significant, with several key sectors likely to see major policy changes. Based on market expert predictions, the following sectors are anticipated to receive substantial attention:
Key Sector-wise Market Expectations:
- Infrastructure: ₹10 lakh crore allocation, up 15% from FY24
- Healthcare: Expected 3.5% increase in budget allocation
- Technology: ₹15,000 crore for digital infrastructure
- Green Energy: ₹35,000 crore for priority sector lending
Market analysts predict potential modifications in Securities Transaction Tax (STT), currently at 0.1% for delivery-based equity trades. There’s speculation about reducing this to 0.075% to boost market participation and liquidity.
Expected Capital Gains Tax Changes:
- Long-term Capital Gains (LTCG):
- Current: 10% on gains above ₹1 lakh
- Expected: Threshold increase to ₹2 lakh
- Short-term Capital Gains (STCG):
- Current: 15% flat rate
- Expected: Possible reduction to 12%
Leading market experts project a potential 12-15% market growth post-budget announcements, with specific focus on:
- Manufacturing sector: Expected 18% growth
- IT sector: Projected 15% uptick
- Banking: Anticipated 20% surge
Source of Information: Budget 2025 Expectations Live. The Hindu Business Line.
Union Budget 2025 Benefits: Real Estate and Home Buyer Benefits
The real estate sector anticipates significant reforms in the upcoming budget, particularly focusing on affordable housing and home buyer incentives.
Suggested Read: Government Schemes for Affordable Housing in India.
Expected Housing Loan Interest Deductions:
- Current limit: ₹2 lakh per annum
- Proposed increase: ₹3.5 lakh for affordable housing
- Additional ₹50,000 deduction for first-time homebuyers
RERA modifications are expected to strengthen buyer protection:
- Mandatory project completion insurance
- Standardized delay compensation rates
- Enhanced penalty provisions for developers
Suggested Read: What is RERA in real estate? Meaning and Impact.
Affordable Housing Initiatives:
- Budget allocation increase to ₹75,000 crore (up 25% from FY24)
- Interest subsidy extension under the PMAY scheme
- New income brackets for affordable housing:
- Metro cities: Up to ₹18 lakh (currently ₹15 lakh)
- Non-metro cities: Up to ₹12 lakh (currently ₹9 lakh)
Property tax reforms are expected to include:
- Standardization of assessment methods
- Digital payment incentives (5% rebate)
- Senior citizen exemptions up to 10%
At Credit Dharma, we understand these changes could significantly impact home loan seekers. Our loan matching software helps navigate through these reforms, connecting borrowers with the most suitable lenders from our network of 40+ banking partners.
Data Source: Budget 2025 Expectations For The Indian Taxpayers. Live Mint.
Nirmala Sitharaman’s Journey and Electoral Impact
Nirmala Sitharaman, currently serving as India’s Finance Minister since 2019, represents Karnataka in the Rajya Sabha. Her journey from an economist to becoming India’s first full-time female Finance Minister marks significant milestones in Indian political history.
Finance Minister Nirmala Sitharaman’s Key Achievements (2019-2024):
- Successfully navigated India’s economy during COVID-19 through ₹20 lakh crore stimulus package
- Implemented major reforms including a reduction in corporate tax to 22%
- Launched Production Linked Incentive (PLI) scheme worth ₹1.97 lakh crore
- Achieved record GST collections (₹1.87 lakh crore in April 2023)
Nirmala Sitharaman Salary Structure and Benefits:
| Component | Monthly Amount |
|---|---|
| Basic Salary | ₹1,00,000 |
| Constituency Allowance | ₹70,000 |
| Office Expense | ₹60,000 |
| Additional Benefits | ₹20,000 |
| Total | ₹2,50,000 |
Major Policy Decisions by Nirmala Sitharaman:
- Introduction of New Tax Regime
- Implementation of PM Gati Shakti (₹100 lakh crore infrastructure plan)
- Bank merger initiatives reducing PSBs from 27 to 12
- Launch of National Monetization Pipeline (₹6 lakh crore)
Source of Information – Nirmala Sitharaman Wiki.
Where Can I Watch The Union Budget 2025 Live?
The Union Budget 2025 presentation will be accessible through multiple digital platforms, ensuring widespread reach and transparency.
Official Viewing Platforms:
- Lok Sabha TV (Primary broadcast)
- Sansad TV (Parliamentary coverage)
- Press Information Bureau website
- Union Budget Mobile App
- Ministry of Finance’s official YouTube channel
Key Timing Details:
| Event | Time |
|---|---|
| Budget Speech Start | 11:00 AM |
| Part A (Economic Survey) | 11:00 AM – 12:30 PM |
| Part B (Tax Proposals) | 12:30 PM – 1:30 PM |
| Document Uploads | Post speech completion |
Digital Access Points:
- Mobile Applications:
- Union Budget App (iOS/Android)
- PIB App
- News Service Division App
- Social Media Updates:
- Twitter: @FinMinIndia
- Facebook: Ministry of Finance
- Instagram: @ministry_of_finance
- Real-time updates on #UnionBudget2025
Live Coverage Features:
- Multilingual broadcast in 12 regional languages
- Sign language interpretation
- Real-time data visualization
- Expert commentary and analysis
- Interactive budget documents post-presentation
Conclusion
The Union Budget 2025 is expected to bring significant reforms across sectors, with particular emphasis on middle-class tax benefits and real estate growth.
With GDP growth projected at 6.8% for FY 2025-26, the budget may introduce substantial changes in tax slabs and real estate policies.
The focus remains on digital transformation and economic revival, potentially benefiting both individual taxpayers and businesses.
For expert guidance on home loans and related budget implications, Credit Dharma’s team of home loan experts stands ready to assist, leveraging their partnerships with 40+ banks to secure the best possible rates.
Frequently Asked Questions [FAQs]
Yes, there is an expectation of a meaningful income tax cut for individuals earning between ₹1 million to ₹2 million annually. Such a reduction aims to boost consumer discretionary demand.
The government is expected to allocate higher funds to schemes aimed at enhancing rural incomes, which would benefit consumer staples and agricultural input companies.
Analysts anticipate higher subsidies for fertilizers, which will support agricultural sectors and potentially lead to increased capital infusion into state-owned insurers.
The budget is likely to focus on bolstering job creation, particularly benefiting manufacturing, construction, and textile companies.
A significant increase in capital expenditure appears unlikely, with a potential rise limited to around 10%, due to competing demands of social spending.
Given the success in the electronics sector, there may be an expansion of PLI schemes to include sub-component manufacturing, benefiting companies like Syrma SGS.
The government aims to reduce the fiscal deficit to 5% of GDP in 2025, down from 6.1% in 2024, indicating a focus on fiscal consolidation.
Analysts expect that income tax cuts, especially for the middle-income group, will boost consumer discretionary demand, positively affecting sectors like automotive and consumer goods.
While specific details are pending, there is an expectation of increased allocations to social welfare programs to support vulnerable populations.
We expect that various budgetary measures aimed at stimulating growth and employment will benefit sectors such as consumer staples, agriculture, manufacturing, and textiles.
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