The Union Budget 2025 introduces significant measures aimed at bolstering India's middle class, directly impacting your personal finances. Here's how:
Personal Income Tax Reforms
Increased Tax Exemption Limit
The zero-tax threshold has been raised to ₹12 lakh from the previous ₹7 lakh. This means individuals earning up to ₹12 lakh annually will not be liable to pay income tax under the new regime.
Revised Tax Slabs
For incomes exceeding ₹12 lakh, the tax slabs have been adjusted to reduce the overall tax burden, leaving more disposable income in the hands of taxpayers.
Housing and Urban Development
Tax Relief on Multiple Properties
Homebuyers can now claim tax benefits on two self-occupied properties, a change from the previous allowance of only one.
Increased TDS Exemption on Rental Income
The Tax Deducted at Source (TDS) exemption limit on rental income has been raised from ₹2.4 lakh to ₹6 lakh annually, benefiting small taxpayers.
Support for Entrepreneurs and MSMEs
Enhanced Credit for Startups and MSMEs
The budget provides an additional ₹10,000 crore for startup incubation programs and enhanced credit guarantees, facilitating easier access to finance for entrepreneurs.
Support for Gig Workers
Health insurance coverage will be extended to gig workers under the Pradhan Mantri Jan Arogya (PM-JAY) scheme, along with the provision of identity cards and registration on the e-Shram portal for better welfare benefits.
Education and Skill Development
Atal Tinkering Labs
The government plans to establish 50,000 labs in government schools over the next five years to promote innovation in science and technology.
Skill Development Initiatives
Five National Centres of Excellence will be set up for skilling programs in emerging industries like AI, robotics, and renewable energy.
Cost of Living Adjustments
Reduced Prices on Essential Items
The government has fully exempted 36 essential medications for cancer and chronic diseases from basic customs duties. Additionally, customs duties on components for electronics and electric vehicles have been reduced, potentially lowering the cost of these items.
These initiatives are designed to increase disposable income, stimulate consumption, and foster economic growth, thereby positively affecting the financial well-being of the middle class.
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