On Saturday, February 1, 2025, Union Finance Minister Nirmala Sitharaman will deliver her eighth consecutive budget. Examine the main points of Budget 2025.
January 31 marked the start of the first phase of the Parliament’s Budget session, which will conclude on February 13, 2025. The second phase is scheduled to start on March 10 and end on April 4, 2025.
The Union Budget 2025 will be Finance Minister Nirmala Sitharaman’s eighth budget presentation in Parliament overall and her second complete budget under Modi 3.0. Under the Narendra Modi-led NDA governments, FM Sitharaman has so far unveiled two interim and six annual budgets.
It is anticipated that Budget 2025 will offer incentives to important sectors, such as initiatives to support the agriculture industry, job programs, tax breaks, MSMEs, and infrastructure development projects.
On a budget day, the Indian stock market Because of the Union Budget 2025–2026, the BSE and NSE will be open on February 1, 2025, even though it is a Saturday. The exchanges stated in a circular that they will be holding a live trading session on February 1, 2025, due to the introduction of the Union Budget. On Saturdays and Sundays, the Indian stock market is typically closed.
Important adjustments to income tax slabs in the 2025 budget:
Under the new tax system, FM Nirmala Sitharaman declared that income up to ₹12 lakh would be tax-free. The following tax rates and slabs are listed:
| Salary | Income Tax Rates |
|---|---|
| ₹0-4 lakh | Nil |
| ₹4-5 lakh | 5 per cent |
| ₹8-12 lakh | 10 per cent |
| ₹12-16 lakh | 15 per cent |
| ₹16- ₹20 lakh | 20 per cent |
| ₹20-24 lakh | 25 per cent |
| Above ₹24 lakh | 30 per cent |
Does the middle class benefit from changes in income taxes?
Budget 2025 provided much-needed respite for the middle class in India by lowering the income tax rates suggested in the new tax regime and eliminating taxes on income up to ₹12 lakh. This is the amount of tax you will save under the new system following Budget 2025.
Among the most important lessons learned from FM Nirmala Sitharaman’s budget speech are the following:
1) Budget deficit: The FY26 budget deficit is projected to be 4.4%, whereas the FY25 fiscal deficit is set at 4.8%.
2) Regarding the Jan Vishwas Bill: More than 100 sections will be decriminalized in the upcoming Jan Vishwas Bill 2.0. In 2025, an investment-friendly index of states will be introduced.
3) Updated tariff rates: Remove seven tariff rates above those eliminated in the previous budget. After the new change, there will only be eight tariff rates left.
4) The FM announced a ₹1.5 lakh crore investment in 50-year interest-free loans to states for infrastructure and capital expenditures.
5) FM declared that 36 medications and live savings drugs were completely exempt from basic customs duties.
Budget 2025 LIVE: These are the main indicators to watch for in the next fiscal year, per Nirmala Sitharaman’s release of the Budget 2025-26.
1. Total revenue of ₹34.96 lakh crore (not including borrowings)
2. Revenues from net taxes: ₹28.37 lakh crore
3. The entire amount spent was ₹50.65 lakh crore.
4. ₹11.2 lakh crore was spent on capital projects.
5. The fiscal deficit is 4.4% of GDP.
(According to FY2025–26 budget forecasts.)
In terms of income tax rates, where does India stand?
For those in the highest income bracket in India, the highest income tax rate is 30%. Depending on the tax regime they are in, there is also an additional surcharge of up to 25% or 37%. The highest income tax rate in the US, which is 37 percent, is applied to income beyond $609,000, or about ₹5.3 crore.
Budget 2025 Share Market Impact: Indian stock market traders experienced high volatility today as the Finance Minister Nirmala Sitharaman presented the Union Budget 2025-2026 in the Parliament. Stock and commodity exchanges, BSE, NSE and MCX conducted a special trading session on Saturday, 1 February 2025, on account of the Budget 2025.
Today’s stock market
Following the Budget address by Finance Minister Nirmala Sitharaman, the benchmark indices, the Sensex and Nifty 50, concluded the day flat due to significant volatility. Due to the influence of the budget on the share market, investors were keeping a close eye on important industries such as insurance, FMCG, real estate, power, railways, and defense.
After experiencing significant swings during the day, the Sensex ended the day 5.39 points, or 0.01%, higher at 77,505.96, while the Nifty 50 ended the day 26.25 points, or 0.11%, lower at 23,482.15. Nifty FMCG, Nifty Realty, Nifty Media, and Nifty Auto saw the most rallies among sectoral indexes, while Nifty PSU Bank, Nifty Metals, Nifty Pharma, and Nifty Oil & Gas saw the biggest declines.
Highlights of the Budget 2025 Share Market: Following the presentation of the Union Budget 2025–2026 on Saturday, the major Indian stock market indices, the Sensex and Nifty 50, ended the day flat due to volatility. The following are the main takeaways from Budget Day’s stock market activity:
- Sensex up 5.39 points, or 0.01%, at 77,505.96
- Nifty 50 down 26.25 points, or 0.11%, at 23,482.15
- Bank Nifty down 80.25 points, or 0.16%, at 49,506.95
- Nifty Smallcap 100 up 0.41%; Nifty Midcap 100 down 0.42%
- Sectoral Gainers: Nifty FMCG, Nifty Realty, Nifty Media, Nifty Auto
- Sectoral Losers: Nifty PSU Bank, Nifty Metals, Nifty Pharma, Nifty Oil & Gas
- Top Nifty 50 Gainers: Trent, ITC Hotels, Maruti Suzuki India, Tata Consumer Products, Eicher Motors
- Top Nifty 50 Losers: Bharat Electronics, PowerGrid Corporation of India, Larsen & Toubro (L&T), Cipla, Grasim Industries
After the Budget, what can we anticipate from the RBI?
Impact of the Budget 2025 Share Market LIVE: With the significant income tax reliefs for the poor and middle classes, the budget is anticipated to significantly increase consumption. The budget has provided this enormous boost for increased consumption at a time when the economy was slowing down and incremental capital expenditures were starting to produce a decreasing multiplier factor on the margin, as most economists had hoped. It is anticipated that the economy will quickly recoup its lost pace in conjunction with sustained capital expenditure.
Another encouraging aspect that should enhance India’s chances of receiving a rating upgrade is the country’s continued adherence to the planned fiscal consolidation route while offering tax relief. Mahendra Kumar Jajoo, CIO Fixed Income at Mirae Asset Investment Managers (India), stated that the RBI is likely to take note of this as well and that a more accommodating monetary policy is anticipated in the near future.
Budget increases EVs, autos, and FMCG; rising yields could put pressure on banks: FMCG, consumption, retail, real estate, auto, and new-age businesses all benefit from it overall. Less favorable for banking. Increases in gross borrowings hurt banks since they may result in higher yields, which would affect treasury income. The fiscal deficit objective is 4.8% of GDP for FY25 and 4.4% of GDP for FY26.
One must observe how government capital expenditure targets are established in light of the rationalization of direct taxation. According to Manish Jain, Chief Strategy Officer, Institution Business, Mirae Asset Capital Markets, the move to exclude EV batteries from BCD and to boost EV battery manufacturing in India is a good thing for battery chemistry makers.
