Budget 2025: ₹12 Lakh Tax-Free, Middle-Class Boost
Union Budget 2025 Outcomes and New Income Tax Slab Announcements. Here are all the major updates from the Union Budget by Finance Minister Nirmala Sitharaman in Parliament. Get the latest information on income tax rates and slabs, capital expenditure, new infrastructure initiatives, agricultural developments, railway investment plans, and more.
Updated Income Tax Slabs for 2025-26:
₹0-4 lakh: No tax
₹4-8 lakh: 5%
₹8-12 lakh: 10%
₹12-16 lakh: 15%
₹16-20 lakh: 20%
₹20-24 lakh: 25%
₹24 lakh & above: 30%
Curious about how much you’ll save?
Finance Minister Nirmala Sitharaman announced that individuals earning up to ₹12 lakh (excluding special rate income like capital gains) will receive a tax rebate along with the slab rate reductions, ensuring no tax liability for them.
Here’s an example of the savings: Under the new regime, a taxpayer with an income of ₹12 lakh will enjoy a tax benefit of₹80,000, effectively eliminating their tax liability compared to the previous rates.
Union Budget 2025 Highlights & Tax Updates
Revised Income Tax Slabs (2025-26):
₹0-4 lakh: No tax
₹4-8 lakh: 5%
₹8-12 lakh: 10%
₹12-16 lakh: 15%
₹16-20 lakh: 20%
₹20-24 lakh: 25%
₹24 lakh & above: 30%
Tax Benefits:
Income up to ₹12 lakh: Zero tax after rebates and slab adjustments.
₹12 lakh income saves ₹80,000, no tax payable.
18 lakh income saves ₹70,000.
₹25 lakh income saves ₹1,10,000.
Focus Areas:
Emphasis on democracy, demography, and demand for Viksit Bharat.
Acknowledgement of middle-class contributions with tax relief.
Major Announcements:
Focus on Gareeb (poor), Youth, and Nari (women).
Addressing agri-underemployment; benefits for 1.7 crore farmers.
National Mission on High-Yielding Seeds and 5-year cotton productivity program.
India Post to become a large public logistics firm.
50,000 Atal Tinkering Labs in government schools within 5 years.
₹10,000 crore Fund of Funds for startups.
75,000 new medical seats over 5 years.
Kisan Credit Card limit increased to ₹5 lakh for 7.7 crore farmers.
MSME term loans up to ₹20 crore.
Modified UDAN Scheme with 120 new destinations.
SWAMIH Fund to complete 40,000 housing units in 2025.
Development of top 50 tourism destinations.
Also read: Budget 2025: Key Expectations from FM Nirmala Sitharaman
National Geospatial Mission launched.
Second Gene Bank for future food security.
Greenfield airports in Bihar.
A new income tax bill is set to be introduced next week.
Jan Vishwas Bill 2.0 to decriminalize 100 provisions.
Fiscal & Economic Updates:
The fiscal deficit is estimated at 4.8% of GDP.
Capital expenditure at ₹10.18 lakh crore.
Gross market borrowings at ₹14.82 lakh crore.
Social welfare surcharge waived on 82 tariff lines.
36 life-saving drugs exempted from customs duty.
9 handicraft items added to duty-free inputs.
Personal Tax Reforms:
Special focus on middle-class tax relief.
TCS on education remittances removed.
Simplified compliance for small charitable trusts.
New scheme for arm’s length pricing in international transactions.
Ongoing tax framework digitalization.
Startup incorporation benefits are extended for five years.
No tax on income up to ₹12 lakh.
Capital gains exemption raised to ₹12.7 lakh.
30% tax rate now applies to income above ₹24 lakh (previously ₹15 lakh).