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Budget 2025 Highlights

Budget 2025 Highlights : 12 Lakhs Tax Exemption, Lower Gold Duties & Big Boost for Industry

3 min Read Feb 3, 2025

The Union Budget 2025, which began with the Finance Minister's presentation on February 1, gave significant relief to taxpayers. She presented the budget for the eighth time in a row and offered many steps to stimulate the economy. One of the most significant benefits is the exemption from income tax for individual earnings of up to 12 lakhs.

Key Changes in GST & Custom according to the Budget 2025 

GST Updates: Simplification and Expansion

The aim of GST is, first, to reduce the tax burden; second, to ensure compliance; and third, to boost revenue collections for both the central and state governments. The governmental development would focus on simplifying and rationalizing the GST scheme by covering more sectors for doing business in bona fide, which would facilitate tax administration, reduce taxation disputes, and enable the movement of trade.

Customs Duty Changes: Foster Local Industry

The budget seeks to introduce several changes in customs duties. The primary objective of this is to boost domestic production, facilitate imports and exports, and enhance compliance with tax laws. These changes will benefit key sectors like healthcare, electronics, critical minerals, renewable energy, marine products, as well as textiles and metals.

Healthcare: Making Medicines More Affordable

  • Exemption of customs duties on three other medicines used in the treatment of cancer.
  • Changes in the Basic Customs Duty (BCD) on X-ray tubes and flat-panel detectors to align with domestic manufacturing capacity.

Electronics and Mobile Phones: Boosting Competitiveness

  • With a threefold increase in domestic production and a huge jump in exports, the BCD has been lowered to 15% for mobile phones, printed circuit board assemblies (PCBA), and chargers.
  • Elimination of BCD on oxygen-free copper for manufacturing resistors so that value addition can be enhanced in electronics.

Critical Minerals: Strengthening Key Industries

  • The entire customs duty exemption is for 25 critical minerals, including lithium, cobalt, and Rare Earth elements.
  • BCD cuts for two minerals have been made in these sectors: nuclear energy, renewable energy, and defence. 

Renewable Energy: Enhancing Domestic Solar Manufacturing

  • Expansion of the list of exempted capital goods used in manufacturing solar cells and panels.
  • Withdrawal of exemption on solar glass and tinned copper interconnect due to sufficient domestic production.

Marine Products: Strengthening India's Seafood Export Industry

  • The government proposed to reduce the Basic Customs Duty (BCD) on certain broodstock, polychaete worms, shrimp, and fish feeds to a lesser 5%.
  • Customs taxes on the input used to manufacture shrimp and fish feed are waived to increase export competitiveness.

Leather and Textile Industry: Boosting Exports

  • Reduction in BCD on real down-filling material (duck or goose) to make textile exports more competitive.
  • Expansion of the list of exempted goods used in manufacturing leather garments, footwear, and other products.
  • Reduction in BCD on methylene diphenyl diisocyanate (MDI) from 7.5% to 5% to rectify duty inversion for spandex yarn.

Precious Metals: Lowering Duties to Encourage Domestic Value Addition

  • Reduction in customs duties on gold and silver to 6% and platinum to 6.4%, making jewellery more affordable.

Metals and Petrochemicals: Reducing Costs for Key Industries

  • Removing BCD on ferro nickel and blister copper to cut down the cost of production.
  • Continued nil BCD on ferrous scrap and nickel cathode.
  • Concessional 2.5% BCD on copper scrap to support domestic manufacturers.
  • The BCD on ammonium nitrate has been increased from 7.5% to 10% to stimulate local petrochemical manufacture.

Plastics: Addressing Environmental Concerns

  • Increase in BCD on PVC flex banners from 10% to 25% to curb the import of harmful materials.

Telecommunications: Incentivizing Local Production

  • To boost local manufacturing, BCD on PCBAs used in telecom equipment would be increased from 10% to 15%.

Trade Facilitation Measures

  • Extension of export period for goods imported for repairs from six months to one year.
  • Increase in re-import time limit for goods under warranty from three to five years.

Conclusion

Building on the notion of tax relief, economic expansion, and inducing industrial growth in India, Budget 2025 proposes tax concessions for income holders earning below ₹12 lakh, benefiting millions financially, and strategic duty adjustments to ignite industrial growth and the world's competitiveness. She, therefore, harbours an intent for sustainability and clean energy in the blessings performed to India, marked by the urge to be greener. With these amendments, the government hopes to achieve enduring economic resilience ahead.