Finance Minister Nirmala Sitharaman is set to present the Union Budget 2025-26 in the Lok Sabha on Saturday, February 1, at 11 AM. The budget speech will outline the government’s fiscal policies, revenue and expenditure plans, taxation reforms, and other key economic measures for the coming financial year.
Expectations for the Budget: Focus on the Middle Class and the Poor
Ahead of the budget announcement, Prime Minister Narendra Modi hinted at a budget that could bring relief to the poor and middle-class sections of society. Speaking to reporters outside the Parliament in New Delhi, he said, “I pray to Goddess Lakshmi that the poor and the middle-class sections in the country are blessed by her.”
Income Tax Slabs in Budget 2025: Will There Be Changes?
One of the most anticipated aspects of the budget is income tax reforms, especially for the middle class. Income tax slabs in India have remained largely unchanged since 2020, leading to increasing demands for revision. There are two main reasons for this:
- Impact of Inflation: Higher tax slabs now apply at much lower real incomes than before, increasing the financial burden on taxpayers.
- Economic Slowdown: India’s GDP growth is expected to decline from 8.2% in 2023-24 to 6.4% in 2024-25, prompting the need for measures to boost consumer spending.
Expert Opinions on Possible Tax Relief
Economists and industry experts predict that the government may introduce relief measures for taxpayers. Deloitte India economist Rumki Majumdar commented on the potential tax changes, particularly for lower middle-class taxpayers.
Referring to PM Modi’s statement, Majumdar told PTI, “Most likely they (should) probably look at the ₹7-10 lakh income slab, which is where they can probably go for more exemptions. That is a possibility.”
She added that rural development has shown positive growth in recent months due to good agricultural production. However, the middle class continues to feel the financial strain, and targeted tax exemptions could provide much-needed relief. “It’s the middle class, which is kind of getting impacted, and a large proportion actually falls, with between ₹7-10 lakh income. So, it probably makes sense to have some exemptions here and give them some relief. That will definitely boost consumption,” Majumdar noted.
Expectations Run High
With expectations running high, all eyes are on Nirmala Sitharaman’s budget speech on February 1. Whether the government introduces tax exemptions, relief measures, or spending plans to boost the economy, the upcoming budget will play a crucial role in shaping India’s economic future in 2025-26. Stay tuned for the latest updates as the budget unfolds.