The Union Budget 2025-26, presented by Finance Minister Nirmala Sitharaman, brought significant tax relief for the middle class and incentives for the farmers, which were deemed as key pillars of the Indian economy by the FM. The budget introduces tax reforms, agricultural incentives, and social welfare programs aimed at boosting disposable income, improving financial security, and enhancing productivity in the agricultural sector.
Benefits for the Middle Class
Income Tax Relief
One of the most awaited announcements in the budget was the revision of the income tax slabs, providing major relief to salaried individuals.
New tax slabs:
Up to ₹4 lakh: Nil
₹4 lakh – ₹8 lakh: 5%
₹8 lakh – ₹12 lakh: 10%
₹12 lakh – ₹16 lakh: 15%
₹16 lakh – ₹20 lakh: 20%
₹20 lakh – ₹25 lakh: 25%
Above ₹25 lakh: 30%
TDS and TCS Reforms
To simplify tax compliance and ease financial management, the budget proposes:
Raising the TDS threshold on annual rent from ₹1 lakh to ₹6 lakh.
Increasing the TCS (Tax Collected at Source) limit on RBI’s Liberalised Remittance Scheme (LRS) remittances from ₹7 lakh to ₹10 lakh.
These measures aim to reduce compliance hassles and increase financial flexibility for the middle class.
Investment and Housing Incentives
Taxpayers can now claim the annual value of two self-occupied homes as nil without conditions, reducing tax burdens on property owners.
Investment and MSME Growth
Recognizing the role of startups and MSMEs (Micro, Small, and Medium Enterprises) in employment generation and economic growth, the government has expanded tax incentives for these sectors. This move is expected to indirectly boost job creation, as small businesses and startups are primary drivers of employment.
The National Manufacturing Mission has been launched to support small, medium, and large industries and strengthen the “Make in India” initiative.
A ₹30,000 limit UPI-linked credit card under PM SVANidhi will provide financial assistance to street vendors and small businesses.
FDI limit for insurance has been increased from 74% to 100%, encouraging more private sector investments.
Technology and Education Reforms
The government has committed to setting up 50,000 Atal Tinkering Labs in government schools across the country over the next five years. These labs are part of the Atal Innovation Mission (AIM) initiative, which aims to encourage young minds to engage in creative and innovative activities.
In line with the growing importance of artificial intelligence (AI), the government has proposed the establishment of a Centre of Excellence in Artificial Intelligence for Education with an outlay of ₹500 crore. This Centre will focus on the integration of AI into the educational sector to enhance learning experiences and improve educational outcomes.
This includes the issuance of identity cards for gig workers, ensuring their registration on the e-Shram portal, and providing them with healthcare benefits under the PM Jan Arogya Yojana (PMJAY).
Benefits for Farmers
The government has made significant strides in improving financial access and providing better credit facilities to farmers.
Enhanced Kisan Credit Card (KCC) Loan Limit: The Kisan Credit Card scheme is one of the most crucial support systems for Indian farmers, providing them with short-term loans for their agricultural activities.
PM Dhan Dhanya Krishi Yojana: A new initiative focusing on crop diversification, irrigation improvements, and financial support, this scheme is being launched in 100 agricultural districts.
Makhana Board in Bihar: Bihar, which is the leading producer of makhana (fox nut), will benefit from the establishment of a Makhana Board. The board will focus on expanding the cultivation and improving the marketing of makhana. This initiative is expected to open new market opportunities for farmers in Bihar, ensuring higher earnings and the promotion of regional agricultural products
Comprehensive Vegetable and Fruit Program: The government has launched a comprehensive program to strengthen horticulture in India. In partnership with state governments, this program focuses on improving the cultivation of vegetables and fruits, helping farmers diversify their crops and improve their income.
Urea and Fertilizer Self-Reliance
This initiative aims to reduce India’s dependence on fertilizer imports and stabilize fertilizer prices in the domestic market.
Fisheries and Export Promotion
India is the second-largest fishery producer globally. The budget introduces a framework for sustainable fisheries development in India’s economic zone, promoting exports and ensuring long-term viability of the sector.
Infrastructure and Rural Development
₹1 lakh crore Urban Challenge Fund to promote water and sanitation projects and city redevelopment.
₹10,000 crore allocation for infrastructure development in agricultural hubs.
Manbilas Singh is a talented writer and journalist who focuses on the finer details in every story and values integrity above everything. A self-proclaimed sleuth, he strives to expose the fine print behind seemingly mundane activities and aims to uncover the truth that is hidden from the general public. In his time away from work, he is a music aficionado and a nerd who revels in video & board games, books and Formula 1.
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