Budget for Middle Class: Amid the dark clouds of global uncertainty and fears of sluggish growth, Finance Minister Nirmala Sitharaman took care of the middle class through the General Budget 2025-26 and made a big announcement to keep annual income out of the tax bracket to Rs 12 lakh, which can also surpass the doom of the economy, relieve a large section of people and also benefit the government politically.
The finance minister also gave a five-year roadmap
The Finance Minister has also given a roadmap for the next five years to realise the dream of a developed India and expressed his intention to reduce the fiscal deficit from the current 4.8 per cent to three per cent during the next six years, reflecting his government’s strong will in fiscal balance.
On the path of reforms, the insurance sector has been refrained from showing the spirit of any major economic reforms other than fully opening up to foreign investment. However, long-term fundamental reforms seem to be more concerning and, for the first time, the intention to end the licensing regime at the state level has also been shown.
The government is doing vote bank
Prime Minister Narendra Modi and Finance Minister Sitharaman have spoken several times in the past about middle-class income tax payers. This time, the move was taken. Increasing the income tax exemption limit from Rs seven lakh per annum to Rs 12 lakh is being seen by the government as a tool for its “middle class” vote bank.
Finance Minister Sitharaman has said that this will provide an additional amount of Rs 1.1 lakh crore to the general taxpayer, which will help in boosting domestic demand. By the way, the impact of this announcement can also be seen in the assembly elections to be held in Delhi next week. Four big announcements for Bihar also point to the government’s political mission. In Bihar elections are due this year.
New announcements to encourage small industries
In addition, the many announcements to boost exports and manufacturing are an attempt to answer questions being raised by opposition parties on the issue of employment. The announcements made to promote small and medium industrial units of the country will also help in increasing employment opportunities. New announcements have been made to encourage employment-giving industries like leather, textile, food processing, toy.
Finance Minister Sitharaman is in no hurry to improve. The same was done in the last budget. Increasing the limit of foreign investment in the insurance sector from the current 76 per cent to 100 per cent is set to push the old policies forward.
The government is fully prepared on the path of fiscal balance
Presenting the budgetary provisions as a prescription for balanced development in the next five years, Sitharaman has spoken about poverty to the entire country, good schooling for all, excellent and affordable health services, one hundred percent skilled labour and increasing the economic participation of women. However, it is not clear how these goals will be achieved. Perhaps in the coming days, the government’s policies in this regard will be clear.
The biggest good sign for the economy amid the prospects of a slower growth rate is that the government is fully on the path to fiscal balance. The fiscal deficit level in the current fiscal is 4.8 per cent, while next year it is expected to come down to 4.4 per cent.
