The budget presented by our Finance Minister, Smt. Nirmala Sitharaman, was her consecutive eighth budget, setting a record for a lady finance minister. In the past, Mr. Pranab Mukherjee and Mr. Yashwant Sinha have also presented eight budgets. Hence, Smt. Nirmala Sitharaman is poised to surpass them next year. However, the record for presenting the highest number of budgets still belongs to Mr. Morarji Desai, who presented the budget eleven times.
We all know that the budget represents the estimated income and expenditure for the coming year, 2025–26.
| Category | Rupee Comes from (%) | Rupee Goes to (%) |
|---|---|---|
| Borrowing & Other Liabilities | 24 | – |
| Income Tax | 22 | – |
| GST and Other Taxes | 18 | – |
| Corporate Tax | 17 | – |
| Non-Tax Receipts | 09 | – |
| Union Excise Duties | 05 | – |
| Customs | 04 | – |
| Non-Debt Capital Receipts | 01 | – |
| States’ Share of Taxes & Duties | – | 22 |
| Interest Payments | – | 20 |
| Central Sector Scheme | – | 16 |
| Centrally Sponsored Scheme | – | 08 |
| Defense | – | 08 |
| Finance Commission & Other Transfers | – | 08 |
| Other Expenditure | – | 08 |
| Major Subsidies | – | 06 |
| Pensions | – | 04 |
| Total | 100 | 100 |
These figures are expected income and expenditure.
There is scope for Revised Estimates, which will be compare at the time of next year budget.
DIRECT TAX:
New Income Tax Bill introduce current week to take forward the “trust first and scrutinize later” concept.
- A range of tax reforms for the common people and the business owners, including the new tax regime, rationalization of TDS/TCS along with the reforms to ensure enhanced ease in doing in business.
- Personal Income tax reforms with special focus on the middle class, zero income tax till Rs.12 lakh income by way to rebate u/s 87A on income other than income from capital gains or other such income which are taxable at special rates; for salaried employees, tax liability would be NIL up to salary income of Rs. 12.75 lakh (which include Standard Deduction of Rs. 75,000)
- Slabs and rates being changed across the board benefit all tax payers.
- Rationalization of TDS/TCS for easing difficulties. Tax deduction limit for senior citizens double from Rs.50,,, to Rs. 1 lakh and the annual limit of Rs.2.40 lakh for TDS on rent increased to Rs. 6 lakh.
- Threshold limits for TDS/TCS for all other sections are also revised upward. However, threshold limit for TDS u/s 194C retained at the same level.
- Extension of time limit to file updated returns, from current limit of 2 years to 4 years.
- Reduced compliance for small charitable trusts/institutions having gross income of Rs. 5 crore or less in immediate preceding 2 financial years, by increasing their period of registration from 5 to 10 years.
- Tax payers to be allowed to claim the annual value of 2 self-occupied properties (previously 01) without any conditions (previously conditions attached).
- Introduction of a scheme for determining arm’s length price of international transactions for a block period of 3 years.
- Expansion of scope of safe harbor rules to reduce litigation and provide certainty in international taxation.
- Proposal to extend the period of incorporation by 5 years, to allow the benefit available to start-ups that are incorporated before 1st April, 2030.
- Proposal to extend specific benefits to ship-leasing units, insurance offices and treasury centers of global companies that are set up in IFSC. Further, to claim benefits, the cut-off date for commencement in IFSC has also been extended by 5 years to 31st March, 2030.
As a result of these proposals, revenue of about Rs. 1lakh crore in direct taxes will be forgone.
INDIRECT TAX:
- The removal of 7 tariff rates, leaving now just 8 tariff rates, including ‘zero’ rate.
- The Social Welfare Surcharge on 82 tariff lines will be exempted, with the government forgoing around Rs. 2,600 crore in indirect tax revenue from these changes.
- 36 life-saving drugs, and medicines have been fully exempted from Basic Custom Duty. Another six life-saving medicines will attract a concessional Basic Custom Duty of 5%. Furthermore, 37 additional medicines, along with 13 new Patient Assistance Programmes, will be fully exempt from Basic Custom Duty.
- Exemption for 35 capital goods for electric vehicle(EV) battery manufacturing, and 28 additional capital goods for mobile phone battery production.
- Time limit for finalizing provisional assessments has been set to 2 years extendable by one more year.
- Importers and exporters will now have the option to voluntarily declare material facts post clearance, pay the duty with interest but without penalties.
- The time limit for using imported inputs for specified end-uses has been extended from 6 months to 1 year.
As a result of these proposals, revenue of about Rs.2,600 crore in indirect taxes will forgone.
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