Tax reforms, fiscal prudence take center stage in Budget 2025: Key takeaways from FM Sitharaman's address

In her detailed address on the Budget 2025, Finance Minister Nirmala Sitharaman focused on the government's emphasis on responsive governance, fiscal prudence, and key reforms aimed at accelerating economic growth.

The Finance Minister highlighted the near completion of the income tax simplification initiative that was announced in July. The Income Tax Bill is set to be introduced next week, continuing the government's commitment to tax reforms.

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Additionally, Sitharaman reiterated that the fiscal deficit for FY2026 will align with the glide path set out in 2021, reflecting the government's continued focus on fiscal discipline.

Key takeaways from the Finance Minister’s address:

• "One thing which I certainly would like to highlight is responding to the voice of the people, which is what Prime Minister Modi is known for in his administration. It's a very responsive government and as a result, the income tax simplification which I announced in July is already completed in its works and we shall bring the bill in the next week… So if we are talking of reform inclusive of taxation, the work is done."


• "This budget also speaks about rationalisation and customs. Tariffs are being brought down, tariffs are being simplified..."


• "There is no reduction in the public spending on capital expenditure. We continue to place emphasis on the multiplier effect that capital expenditure done by government has shown has sustained us. We continue on that, and with all this, our fiscal prudence has been maintained..."


• "Fiscal deficit for FY26 aligns to the glide path given in 2021. Fiscal prudence has been maintained."


• "Govt has put a substantial amount of money in the hands of people through I-T rate rejig in Budget."


• "The approach in this Budget has been to focus on areas that need immediate intervention."


• "Budget has given a plan for how to take the economy towards Viksit Bharat, with a focus on agriculture, rural prosperity, and urban workers."


• "Education and health have been prioritised."


• "If you compare what we have done today with what was done in 2014 under the Congress government...the change in rates has also benefited people earning Rs 24 lakh. Now they have Rs 2.6 lakh more than under the old system. So, it is not just those earning up to Rs 12 lakh who are benefited, because they do not have to pay any tax due to exemptions..."