With the start of the new year 2025, many significant changes are going to happen in India. The Union Budget 2025-26 will be introduced by Finance Minister Nirmala Sitharaman on 1 February 2025, in which several new provisions are expected for all classes from common man to traders. In this budget, many important decisions can be taken like changes in tax slab, new schemes for farmers, new rules to promote digital payment and ease of pension withdrawal.
In this year’s budget, the government’s focus will be on strengthening the economy, creating new employment opportunities and giving relief to the middle class. Also, special attention will be paid to the development of agriculture, education, health and infrastructure. Let us know what will be the impact of these changes that will be implemented from 1 February 2025 and in which areas will be the major changes.
Major changes of budget 2025-26
Possible change in tax slab
In Budget 2025-26, a new slab of income tax can be announced. Experts believe that the government may change the tax slab to provide relief to the middle class. There is a possibility of following changes in the new tax regimen:
| Income limit | Tax rate |
| 0 – 3 lakh rupees | No tax |
| 3 – 7 lakh rupees | 5% |
| 7 – 10 lakh rupees | 10% |
| 10 – 12 lakh rupees | 15% |
| 12 – 15 lakh rupees | 20% |
| More than 15 lakh rupees | 30% |
In addition, the standard deduction limit is also expected to be increased to Rs 75,000. This change can prove to be a big relief for taxpayers.
New schemes for farmers
The government can announce many new schemes to increase the income of farmers and strengthen the agricultural sector. Prominent among them are:
- The amount given under the PM Kisan Samman Nidhi scheme can be increased from Rs 6,000 to Rs 12,000.
- Farmers will be given agricultural loans up to Rs 2 lakh without guarantee.
- GST rates can be reduced on agricultural equipment.
- The Soil Health Card scheme will be further strengthened.
Promotion of digital payment
To promote Digital India, the government can increase the limit of UPI payment:
- The UPI 123pay can be increased from Rs 5,000 to Rs 10,000 per transactions.
- The limit of UPI Lite can be increased from Rs 500 to Rs 1,000.
This change can prove beneficial especially for senior citizens and people in rural areas.
Simplification in EPFO Pension Withdrawal
There is good news for the Power Provident Fund Organization (EPFO) pensioners. Under the new rules, they will be able to remove their pension from the ATM of any bank. The Ministry of Labor is upgrading the IT system to simplify the PF withdrawal process.
Other important changes
Increase in car prices
From 1 January 2025, major automobile companies such as Maruti Suzuki, Hyundai, Mahindra and MG will increase the prices of their vehicles by 2-4%. This increase is being done due to input cost and increase in operational expenditure.
Direct tax code 2025
The government is preparing to implement Direct Tax Code 2025, which will replace the current Income Tax Act, 1961. Its main provisions are:
- The concept of Assessment Year and Previous Year will end.
- The rules of residential status will be simplified.
- Capital gains will be considered part of general income.
- The same tax rate will be applicable for domestic and foreign companies.
Improvement in education sector
Many important announcements can be made for the education sector in Budget 2025-26:
- Emphasis will be laid on the implementation of New Education Policy.
- There is a demand for reduction in GST on educational services.
- Scholarship can be increased for higher education.
- New provisions can be made to promote digital education.
Investment in health sector
After the Kovid-19 epidemic, the government is paying special attention to the health sector. The following announcements can be made in Budget 2025-26:
- The exemption limit on health insurance can be increased.
- Announcement of special funds to improve health facilities in rural areas.
- New provisions to promote telemedicine and e-health services.
Real estate sector improves
The government can take several steps to promote the housing sector:
- Under PM Awas Yojana Urban 2.0, housing will be arranged for 10 million urban poor and middle class families.
- Stamp duty can be reduced, especially for assets purchased by women.
- Urban land records will be digitized.
infrastructure development
The government can announce many big projects to strengthen the country’s infrastructure:
- Transit oriented development scheme will be prepared for 14 big cities.
- Investment-Reddy Industrial Parks will be developed in or around 100 cities.
- 12 industrial parks will be approved under the National Industrial Corridor Development Program.
Facility in foreign travel
Thailand will introduce its global e-visa system from 1 January 2025. This digital platform will simplify the visa application process for international passengers. Indian citizens can visit Thailand without a visa to travel up to 60 days.
Impact of budget 2025-26
Effect on middle class
In Budget 2025-26, several provisions can be made to provide relief to the middle class:
- Income tax exemption will increase disposable income.
- Increase in exemption on health insurance and life insurance will promote savings.
- It will be easier to buy a house with affordable housing schemes.
Impact on trade and industry
Several steps can be taken to promote trade and industry in the budget:
- Corporate tax rates can be reduced.
- Special incentive plans for startups can be declared.
- New provisions can be made to promote Make in India and Atmanirbhar Bharat.
Impact on rural economy
The government can take several steps for the development of rural areas:
- The use of the latest technology in the agriculture sector will be promoted.
- Rural Employment Guarantee Scheme MGNREGA budget can be increased.
- Special programs can be started to increase digital literacy in rural areas.
Rejuvenation: This article is only for informative purposes and the information given in it is collected from various sources. Although we have tried to provide accurate information, there may be a change in government policies and rules. Therefore, readers are requested to consult the concerned government departments or experts before taking any decision. The author or publisher will not be responsible for any loss or result caused by the use of the information given in this article.
