India Budget 2025 Key Takeways: lowering income tax for the middle class employee

NEW DELHI (AP) – The government of Indian Prime Minister Narendra Modi presented an annual budget in parliament on Saturday which focused on the courtification of the employee middle class with tax reductions and economic growth by stimulating agriculture and manufacturing.

In his discourse on the budget, the Minister of Finance, Nirmala Sitharaman, said that the government has focused on stimulating private investments to strengthen growth, increase funding from the agriculture sector and improve the power of spending spending of the Indian middle class.

“The objective of the budget is to bring everyone together on an inclusive path,” said Sitharaman, adding that the government aims for a budget deficit of 4.4% of the gross domestic product for the year 2025-26 .

The fifth world economy should display its slowest growth in four years due to a slow manufacturing sector, persistent food inflation, stagnant growth and low urban consumption. The country’s chief economic adviser, in a report published on Friday, provided that the economy of India would increase by 6.3% to 6.8% in the next financial year.

Here are some points to remember from the budget:

Income tax reductions for the middle class employee

Sitharaman said his government would initiate reforms in sectors such as finance, power, urban development and mining, with “taxation of taxation”. It increased the starting point for income tax to $ 14,800, compared to $ 8,074 and said the government would present a new income tax bill next week.

“The new structure will considerably reduce the taxes of the middle class and leave more money in their hands, stimulating consumption, savings and investment of households,” said Sitharaman.

Modi, who is now in his third term as Prime Minister of the country, has been under pressure to appease the dissatisfaction of the country’s middle class and generate more jobs to help support growth. Many economists had suggested that his government carry out tax discounts on the income of individuals and implementing job creation programs to mitigate unemployment.

According to the Center for monitoring the Indian economy, young people unemployment was 7.5% in January, highlighting the challenge of providing jobs in a country of more than 1.4 billion people.

The agriculture sector and the concert economy gets a boost

To stimulate productivity in the agriculture sector, the Indian government will launch a national program to push high -efficiency crops, focusing on the cultivation of pulses and cotton production. Sitharaman said the program will target at least 17 million farmers and increase the subsidized credit limit offered from $ 3,460 to $ 5,767.

The government also plans to officially register workers from India concerts and facilitate their access to health care. Sitharaman said the government will issue them identity cards and maintain a national register which will ensure their inclusion in well-being initiatives.

The India concert economy could employ more than 23 million people by 2030, according to estimates by the Niti Aayog government’s thinking group.

Investments in new start -up funds and the energy sector

Sitharaman has announced a new fund for startups and said the government will provide more money to promote innovation in partnership with the private sector and launch programs to push manufacturing and exports. The share of manufacturing in the economy of India is close to 17%, less than its objective of 25%.

The government will infuse more money to increase the job led by tourism in several Indian states and would help create infrastructure and stimulate air connectivity to 120 new destinations over 10 years, Sitharaman said.

It also announced the nuclear energy mission to generate the transition from India to clean energy, with the aim of developing at least 100 GW of nuclear energy by 2047.