New Delhi, March 25 (IANS) The Lok Sabha passed the Finance Bill 2025 on Tuesday incorporating 35 government amendments as a key part of the process for the proposals of Union Budget 2025-26 to kick in. Union Finance Minister Nirmala Sitharaman, in her reply to the debate on Finance Bill, 2025, said the Union Budget of 2025-26 provides “unprecedented tax relief to honour taxpayers” and is aimed at boosting domestic production and enhancing export competitiveness. She highlighted the changes aimed at tariff rationalisation and boosting domestic manufacturing in her discussion of the Finance Bill.

She said that the Customs Duty rationalisation announced in the Budget proposals for 2025-26 was moving forward. The Finance Minister said that the government is removing seven customs tariff rates to address duty inversion and lower input costs and the Finance Bill now ensures that imports will attract either a cess or a surcharge, but not both. In order to give a fillip to domestic production, the government has exempted 35 additional capital goods for EV batteries and 28 for mobile manufacturing from customs duties.

With the Budget now approved by the Lok Sabha it will be taken up for discussion by the Rajya Sabha. However, the Upper House does not have the power to vote on the Budget and cannot reject any proposal. The Finance Minister also said that the new Income Tax Bill to replace the Income Tax Act, 1961 will be taken up for discussion in the Monsoon Session of Parliament. The Finance Minister has kept the budget deficit target on a declining path to 4.4 per cent of the GDP in 2025-26 from 4.8 per cent of the GDP in 2024-25. The Budget also aims to spur growth by driving up demand as 1 crore people with incomes of up to Rs 12 lakh per annum will not have to pay any tax. This will place more money in the hands of the middle class for spending.

The net market borrowing for the budget has been fixed at Rs 11.54 crore while the rest of the funds will come from small savings schemes. The Budget proposes a gross tax revenue collection of Rs 42.70 lakh crore and a gross borrowing of Rs 14.01 lakh crore. The Union Budget 2025-26 envisages a total expenditure of Rs 50.65 lakh crore, an increase of 7.4 per cent over the current fiscal. It has maintained fiscal prudence without compromising on the quality of expenditure with the total capital expenditure proposed for the next fiscal is put at Rs 11.22 lakh crore up from Rs 10.2 lakh crore as per FY25 RE. The Budget aims to give a big push to employment-led growth with its focus on the agricultural and rural sector, MSMEs and exports while sticking to the fiscal consolidation path to ensure stability in the economy.

/IANS