
Key Highlights:
- Tax Relief for Middle Class: Finance Minister Nirmala Sitharaman announced zero tax on income up to ₹12 lakh, marking the biggest tax reform of the year.
- Imports Get Costlier: Items such as solar cells, imported footwear, and touch-screen displays to see price hikes due to increased customs duties.
- Cheaper Life-Saving Medicines: Customs duty reductions will make cancer drugs, rare disease medications, and premium imported cars more affordable.
- Focus on Development: The budget emphasizes widespread economic growth, with reforms targeting health, infrastructure, and ease of living.
- Parliament Adjourned: Following the budget speech, the House has been adjourned till Monday for further discussions.
New Delhi: Finance Minister Nirmala Sitharaman delivered her eighth Union Budget speech this Saturday, unveiling a slew of reforms targeting various sectors of the economy. While the biggest headline was zero tax on income up to ₹12 lakh, the budget also introduced measures that will make several imported items costlier. At the same time, life-saving medicines and essential medical imports will become cheaper, reflecting the government’s focus on improving healthcare accessibility.
Tax Break: Zero Tax on Income Up to ₹12 Lakh
The standout highlight was the Finance Minister’s announcement of zero income tax for individuals earning up to ₹12 lakh annually, offering significant relief to the middle class. Salaried individuals will benefit further with the retention of the ₹75,000 standard deduction, effectively making income up to ₹12.75 lakh tax-free.
This groundbreaking tax reform is expected to:
- Increase disposable income, stimulating household consumption.
- Encourage savings and investments, boosting economic growth.
Imported Items That Will Get More Expensive
Several imported goods will face price hikes due to increased customs duties, particularly focusing on luxury and non-essential items. Here’s what will cost more:
- Interactive Touch-Screen Displays: Used in smart classrooms and high-tech workplaces.
- Solar Cells: A key component for renewable energy projects.
- Imported Footwear: High-end foreign brands to see price increases.
- PVC Flex Banners, Films, and Sheets: Widely used in advertising and signage.
- Imported Candles: Non-essential decorative items face higher duties.
- Luxury Boats and Vessels: Recreational imports to get pricier.
- Certain Imported Woven Fabrics: Including premium textiles.
Goods That Will Become Cheaper
On the brighter side, the government reduced duties on essential imports to make them more affordable:
- Life-Saving Medicines: Drugs for treating cancer, rare diseases, and other chronic illnesses.
- Premium Imported Cars and Motorcycles: Marginal duty cuts aim to benefit the automotive luxury sector.
Economic Impact of Budget Announcements
The budget reflects a balanced approach toward fostering growth while encouraging local manufacturing.
- Encouraging ‘Make in India’: By increasing duties on imports like solar cells and woven fabrics, the government aims to promote domestic industries.
- Improving Public Health: Cheaper life-saving medicines reinforce the government’s focus on reducing healthcare inequality.
- Boosting Consumption: Tax reforms are expected to stimulate disposable income, benefiting sectors like real estate, retail, and automobiles.
Reactions to the Budget
The tax relief announcement has been welcomed by the middle class, with many praising the focus on affordability and healthcare. However, critics argue that higher customs duties on essentials like solar cells and footwear could impact consumers and businesses.
Economist’s View:
“While the middle class gains through tax breaks, higher costs of imports may burden certain industries reliant on foreign goods,” said Dr. Richa Malhotra, an economic policy expert.
Consumer Reaction:
- “Cheaper cancer medicines are a welcome step, but solar cell costs will hurt renewable energy projects,” said Ajay Gupta, a solar entrepreneur.
Looking Ahead
With sweeping changes announced, the government faces the challenge of implementing these reforms seamlessly. Parliament will reconvene on Monday to dissect the budget further, with debates likely focused on:
- The impact of customs duty hikes on specific industries.
- Feasibility of tax reforms given fiscal deficit constraints.
- Roadmap for integrating these policy changes within India’s broader economic recovery strategy.
Conclusion: A Budget of Contrasts
The 2025-26 Union Budget strikes a balance between middle-class relief and promoting domestic industries. While zero tax on income up to ₹12 lakh is being hailed as a historic move, higher import duties remind consumers of the government’s push toward self-reliance under ‘Make in India.’
For millions of taxpayers and businesses, the new policies offer a fresh perspective on balancing affordability, sustainability, and economic growth.