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Budget 2024-25

Budget 2024-25

Union Budget 2024-25: ‘Angel Tax’ Abolished For All Investors, Corporate Tax Cut For Foreign Companies

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In the Union Budget 2024-25, Finance Minister Nirmala Sitharaman announced the abolition of ‘angel tax’ for all investors and a reduction in corporate tax for foreign companies. She also introduced measures to boost the financial sector and simplify investment regulations.

During today’s presentation of the Union Budget 2024-25 to Parliament, Union Minister for Finance and Corporate Affairs, Nirmala Sitharaman, has announced the abolition of ‘angel tax’ for all investor categories. This move is designed to strengthen the Indian start-up ecosystem, enhance entrepreneurial activity and foster innovation.

Additionally, Sitharaman proposed reducing the corporate tax rate for foreign companies from 40 per cent to 35 per cent to attract foreign investment for India’s developmental needs.

The Minister introduced a financial sector vision and strategy document aimed at addressing the financing needs of the economy and preparing the sector in terms of scale, capacity and skills. This document will set the agenda for the next five years and guide government, regulatory bodies, financial institutions and market participants.

The government will also seek legislative approval to introduce an efficient and flexible financing mode for leasing aircraft and ships and for pooled private equity funds through a ‘variable company structure,’ according to Sitharaman.

To facilitate foreign direct investments, streamline prioritisation and encourage the use of the Indian Rupee for international investments, the Finance Minister announced simplifications to the rules and regulations governing Foreign Direct Investment and Overseas Investments.

To support the diamond cutting and polishing industry, which provides numerous jobs, the Finance Minister proposed implementing safe harbour rates for foreign mining companies selling raw diamonds.

Lastly, a simplified tax regime for foreign shipping companies operating domestic cruises was proposed to harness the potential of cruise tourism and boost this employment-generating sector.

Income Tax

FM Nirmala Sitharaman Announces Revised Rate Slabs Under New Tax Regime

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Finance Minister Nirmala Sitharaman announced new tax slabs under the revised regime, featuring no tax up to Rs 3 lakh and increasing rates up to 30 per cent for incomes above Rs 15 lakh. The budget also outlines initiatives for employment, MSMEs, agriculture and infrastructure, with significant allocations for skilling, rural development and social welfare.

Finance Minister Nirmala Sitharaman has announced revised tax slabs under the new tax regime. The updated rates are set as follows: no tax for income up to Rs 3 lakh, 5 per cent for Rs 3-7 lakh, 10 per cent for Rs 7-10 lakh, 15 per cent for Rs 10-12 lakh, 20 per cent for Rs 12-15 lakh and 30 per cent for income exceeding Rs 15 lakh. This revision is part of the Central Government’s broader fiscal strategy, which maintains the FY25 capital expenditure at Rs 11.1 lakh crore and allocates 3.4 per cent of GDP for infrastructure investment.

The budget outlines several key initiatives. For employment and skilling, the government is committing Rs 2 lakh crore over five years to five schemes designed to benefit 4.1 crore youth. This includes a comprehensive internship programme for one crore youth in top companies, employment-linked incentives such as wage support for first-time employees and targeted skilling programmes for women to increase their workforce participation.

Support for MSMEs and the manufacturing sector is also emphasised. The budget includes a credit guarantee scheme, term loans for machinery purchases and a technology support package for MSMEs. Additionally, SIDBI is set to open 24 new branches to better serve MSME clusters. Financial initiatives include raising the Mudra loan limit from Rs 10 lakh to Rs 20 lakh for existing borrowers, providing financial aid for higher education loans up to Rs 10 lakh and implementing an integrated technology system for the Insolvency and Bankruptcy Code (IBC).

In agriculture and rural development, the government has allocated Rs 2.66 lakh crore, focusing on transforming agricultural research to improve productivity and develop climate-resilient crops. There is also a significant push to introduce 1 crore farmers to natural farming over the next two years. Infrastructure and regional development plans include rental housing in PPP mode for industrial workers, Rs 15,000 crore in special support for Andhra Pradesh and new airports, medical facilities and sports infrastructure for Bihar.

The economic outlook highlights a projected inflation rate nearing 4% and describes India’s economic growth as a “shining exception.” The budget aims to boost job creation and consumption, which is expected to benefit sectors such as consumer goods, real estate, and automobiles. Nine priority areas have been identified, including agriculture, employment, and infrastructure. Additionally, over ₹3 lakh crore is allocated for schemes benefiting women and girls, while social welfare measures include extending the PMGKAY (Pradhan Mantri Garib Kalyan Anna Yojana) for five years, aiding over 80 crore people. The budget also focuses on advancing digital infrastructure, developing Digital Public Infrastructure (DPI) applications for credit, e-commerce, law and justice, and corporate governance.

Nirmala Sitharaman (1)

Union Budget 2024-25: Sitharaman Declares India’s Economic Growth As A “Shining Exception”

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Finance Minister Nirmala Sitharaman’s Union Budget 2024-25 highlights India’s economic growth as a “shining exception,” focusing on income tax reforms, ease of business and increased funding for women’s welfare.

Finance Minister Nirmala Sitharaman unveiled the Union Budget for 2024-25 on Tuesday, following Cabinet approval. In her opening remarks, Sitharaman highlighted India’s economic growth as a “shining exception” in the global landscape.

“Our goal is to ensure that all Indians, regardless of their religion or age, can achieve their life goals and aspirations,” Sitharaman stated.

This budget marks Sitharaman’s seventh consecutive presentation and is the first for the Modi 3.0 administration. It was delivered during the Monsoon Session of Parliament, which also saw the tabling of the Economic Survey 2023-24.

The Union Cabinet, led by Prime Minister Narendra Modi, approved the budget earlier today. This budget not only continues Sitharaman’s streak, surpassing the late Moraji Desai’s record of six consecutive budgets, but is also anticipated to address changes in income tax structures and improve the ease of doing business in India.

Minister of State for Finance, Pankaj Chaudhary, emphasised that this budget will embody Prime Minister Modi’s vision of “Sabka Saath Sabka Vikas.”

Union Minister Pralhad Joshi asserted that this budget will further accelerate the country’s economic growth. “Under Prime Minister Modi’s leadership, this budget will build on our previous economic progress and continue to strengthen our position as the fastest-growing economy,” Joshi said in a media briefing at Parliament.

The Parliament’s budget session commenced on July 22 and is scheduled to conclude on August 12. The Economic Survey presented on Monday highlighted the resilience and stable recovery of the Indian economy post-Covid. It also reiterated the government’s commitment to “Nari Shakti” through legislative measures aimed at enhancing women’s participation in various sectors.

Notably, the budget allocation for women’s welfare and empowerment has seen a dramatic 218.8 per cent increase, from Rs 97,134 crore in FY14 to Rs 3.10 lakh crore in FY25. The Gender Budget Statement (GBS) also experienced a 38.7 per cent rise compared to FY24, with its share of the total Union Budget reaching 6.5 per cent in FY25, the highest since the GBS was introduced in FY06. (ANI)