Key Highlights
- Tax reforms lifted the exemption threshold to ₹12 lakh, boosting household spending power.
- The 2025 Income Tax Act replaced the 1961 statute, streamlining compliance and cutting litigation.
- Twenty‑nine labour statutes were merged into four comprehensive codes, extending social security to millions of gig workers.
- The Viksit Bharat Mission superseded MGNREGA, guaranteeing 125 days of wage work per rural family.
- GST 2.0 introduced a two‑tier rate, accelerated refunds, and widened the taxpayer base beyond 1.5 crore.
Detailed Insights
The Union Budget 2025‑26 marked a decisive shift toward outcome‑oriented governance. By simplifying the tax architecture—raising the personal exemption to ₹12 lakh and instituting a single tax year—the government curtailed disputes and reinforced certainty for investors. Parallel labour reforms collapsed a fragmented legal framework into four labor codes covering wages, industrial relations, social security, and occupational safety, thereby reducing compliance burdens while extending statutory protections to roughly 10 million informal workers.
Rural employment policy was overhauled through the Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, which guarantees 125 days of paid labor per household, ensures prompt wage disbursement, and prioritises asset creation in water management, infrastructure, and climate resilience. In the MSME sector, the budget introduced collateral‑free credit schemes, liberalised quality‑control orders, and broadened the definition of micro‑enterprises, facilitating scaling and job creation.
GST 2.0, the latest iteration of the indirect tax regime, moved to a simplified dual‑rate system (5 % and 18 %), slashed classification conflicts, and fast‑tracked refunds, propelling collections to ₹22.08 lakh crore in FY 2024‑25. Export promotion received a dedicated ₹25,060 crore mission, integrating finance, logistics, branding, and digital trade‑facilitation tools such as the National Single Window and ICEGATE to broaden MSME participation in global markets.