The Union Budget of India 2025 was introduced by the Finance Minister, Smt. Nirmala Sitaraman. She announced her eighth consecutive Union Budget in the Lok Sabha on February 1, 2025. This year’s budget shows the major changes and announcements especially beneficial for the middle class. Many big announcements are made under the New Budget and the primary focus is on the middle and lower classes.
However, the Union Budgter also highlighted Union Budgter recognizes 4 Engines of development: Agriculture, MSME, Investment, and Exports. Under Bughte 2025, 1.7 crore farmers will benefit from the ‘Pradhan Mantri Dhan-Dhanya Krishi Yojana’ to cover 100 low agricultural productivity districts. But, the major attractive part of Budgter 2025 was Tax Regime changes, in which the government has announced some new slabs for the Tacx Regime. Can anyone here share information How can one save taxes under this new tax rates?
The Union Budget is unique in many aspects, however, the major topic of discussion is the New Tax regime Slabs for 2025. This is the first full budget of Prime Minister Narendra Modi’s third term. The middle class has been given a big relief in the budget. The Finance Minister has announced that those with annual income up to Rs 12 lakh will not have to pay any income tax. Salaried employees will also get a standard deduction of Rs 75,000.
Apart from that, the Finance Minister has also announced to increase in the limit of Kisan Credit Card (KCC) from Rs 3 lakh to Rs 5 lakh. The government has announced the abolition of basic customs duty on 36 life-saving medicines. FM Nirmala Sitaraman has said that the new Income Tax Bill will come next week. The Finance Minister has announced to increase in the FDI limit for the insurance sector from 74 percent to 100 percent in the budget.
Revised Tax Rate Structure Under the New Tax Regime
Under the guidance of Prime Minister Shri Narendra Modi, the Government has taken steps to understand the needs of the people. Direct tax proposals include personal income tax reforms with a special focus on the middle class, rationalization of TDS/ TCS, encouragement of voluntary compliance with reduction of compliance burden, ease of doing business, and promotion of employment and investment. The revised tax rate structure under the new tax regime proposed in the Budget is as follows;
Total Income per annum
Rate of Tax
₹ 0 – 4 Lakh
NIL
₹ 4 – 8 Lakh
5%
₹ 8 – 12 Lakh
10%
₹ 12 – 16 Lakh
15%
₹ 16 – 20 Lakh
20%
₹ 20 – 24 Lakh
25%
Above ₹ 24 Lakh
30%
How To Save Up To ₹2.6 Lakh Under New Tax Rates?
In the 2025 Budget, the Indian government has introduced several measures under the New Tax Regime (NTR) to enhance tax savings for individuals. Under this new tax regime, individuals earning up to ₹12 lakh annually will not have to pay any income tax. Here check how can you save up to ₹2.6 lakh under the revised NTR;
Increase in standard deduction => In this Budget, the standard deduction for salaried employees has been increased from ₹50,000 to ₹75,000. It means that if your salary is up to ₹7.75 lakh, your taxable income after standard deduction is reduced to ₹7 lakh.
Revised Tax Slabs => The NTR has updated the tax slabs to reduce the tax burden on individuals. As per the regime, for those earning more than ₹12 lacks per year, there will be no tax on income up to ₹4 lacks, 5 percent on income between ₹4 to 8 lakh, 10 percent ₹8-12 lak,h, and 15 percent ₹12-16 lakh. Income between ₹16 to 20 lakh will be taxed at 20 perpercent5 per percent₹20-24 lakh and 30 per percent income above ₹24 lakh.
National Pension System (NPS) Contribution => For private sector employees, the deduction available on the employer’s contribution to NPS has been increased from 10% to 14% of salary. This is in line with the benefits already available to government employees and provides additional tax-saving opportunities.
Family Pension Deduction => The deduction for family pension has been increased to ₹25,000 from the previous ₹15,000. This provides additional relief to individuals receiving family pensions.
By taking advantage of these updated provisions under the Union Budget 2025, individuals can effectively reduce their taxable income and achieve tax savings of up to ₹2.6 lakh under the new tax regime. It is recommended to assess your financial position and consult a tax professional to maximize your benefits under the revised tax structure.