Budget 2025: Key Highlights of Last Budgets Under FM Nirmala Sitharaman

As the Union Budget 2025 approaches, anticipation is building around potential tax reliefs, especially for those earning up to ₹15 lakh annually, and updates on cryptocurrency policies. This year’s Budget may include provisions aimed at supporting the middle class, youth, and farmers. A major point of interest is whether it will live up to the historic impact of the 2021 Union Budget, which is remembered for its bold and transformative approach amidst the COVID-19 pandemic.

Why the 2021 Budget Was Called ‘Once-in-a-Century’

The 2021 Union Budget, presented amidst the challenges of the COVID-19 pandemic, was hailed for its bold, far-reaching reforms. Despite the severe economic impact of lockdowns and job losses, Finance Minister Nirmala Sitharaman focused on long-term structural reforms rather than short-term populism, a decision that garnered widespread praise. The Budget’s key highlights included:

• Healthcare Gets a Major Boost

The allocation for healthcare was increased by 137%, reaching ₹2,23,846 crore. A notable ₹35,000 crore was set aside for the nationwide COVID-19 vaccination program, emphasising the importance of immunisation in fighting the pandemic.

• Reforms in Key Sectors
  1. Insurance FDI Reforms: The Foreign Direct Investment (FDI) limit in the insurance sector was raised from 49% to 74%, attracting global investors.
  2. Bank Recapitalisation: ₹20,000 crore was allocated to recapitalise state-run banks, addressing the rising issue of bad loans.
  3. Strategic Divestments: The government aimed to raise ₹1.75 trillion by selling stakes in public sector companies, including IDBI Bank, and surplus land of state-owned firms.
• Impact on the Markets

The 2021 Budget triggered a historic rally in the stock markets. On February 1, 2021, the NSE Nifty 50 surged by 4.7%, and the S&P BSE Sensex climbed 5%, marking their best budget-day performance in over two decades.

• Social Welfare Initiatives

The government launched the ‘One Nation One Ration Card’ scheme to provide subsidised food grains to rural migrants during the pandemic. This initiative allowed beneficiaries to access food grains from any part of the country.

• A Landmark in Fiscal History

The 2021 Union Budget remains a milestone for its focus on long-term economic resilience and its approach to reviving the economy after the pandemic.

Union Budget Highlights from Previous Years

Union Finance Minister Nirmala Sitharaman’s approach to budget-making over the years has evolved to address the challenges and opportunities of each specific year. Here’s a look at key highlights from the last Union Budgets:

Union Budget 2024: Key Highlights from FM Sitharaman’s Speech

In 2024, Finance Minister Sitharaman focused on supporting the poor, women, youth, and farmers while driving growth, job creation, and middle-class relief. Here are the main points:

• Revision in Tax Slabs: Changes in the new tax regime with savings for taxpayers up to ₹17,500.
• Increased Standard Deduction: Standard deduction for the new tax regime was raised from ₹50,000 to ₹75,000.
• Capital Gains Taxes: Raised tax on short-term capital gains from 15% to 20% and long-term capital gains from 10% to 12.5%.
• Fiscal Deficit Target: The fiscal deficit for FY25 is projected at 4.9% of GDP.
• Customs Duty Reductions: Duty cuts on metals like gold, silver, and lithium, as well as customs duty reductions for mobile devices and cancer medicines.
• Job Creation & Agriculture: ₹2 lakh crore allocated for job creation, focusing on skills for youth and women’s participation, and ₹1.52 lakh crore for agriculture and allied sectors.

Budget 2023: “Amrit Kaal” Vision

• Focus on Opportunities: The vision centred on creating opportunities for citizens, especially the youth, and promoting growth and job creation.
• Proposed Spending: ₹45.03 lakh crore, with ₹35.02 lakh crore allocated for revenue expenditure.
• Tax Changes: The income tax rebate limit was raised from ₹5 lakh to ₹7 lakh, providing significant relief to the middle class. The highest surcharge rate on income above ₹5 crore was reduced from 37% to 25%.
• Retirement Benefits: Tax exemption on leave encashment for private sector employees was increased to ₹25 lakh.
• Capital Investment: A 33% increase in capital investment outlay to ₹10 lakh crore.

Budget 2022: Green Economy & AtmaNirbhar Bharat

• Shorter Speech: Sitharaman delivered her shortest Budget speech to date, with no changes in income tax slabs.
• Focus on Green Economy: A major emphasis on creating a greener economy and supporting “Made-in-India” initiatives.
• Support for AtmaNirbhar Bharat: A Productivity Linked Incentive scheme was introduced in 14 sectors to boost domestic manufacturing.
• Cryptocurrency & Digital Initiatives: A 30% tax was imposed on income from cryptocurrency transactions, alongside a 1% TDS on transactions exceeding a specified threshold. Announced the launch of the ‘Digital Rupee’ and e-passports with embedded chips.
• Technology Push: Spectrum auctions and the rollout of 5G mobile services were planned for 2022-23.

Budget 2021: Post-Pandemic Economic Recovery

• Focus on Recovery: Aimed at economic recovery post-COVID-19, with substantial allocations for healthcare and infrastructure.
• Key Announcements: Introduction of the Agriculture Infrastructure Fund (AIF) and a voluntary vehicle scrappage policy to boost the auto sector.
• Fiscal Deficit: Targeted fiscal deficit of 6.8% of GDP.
• Proposed Spending: ₹34.83 lakh crore to stimulate growth and recovery.

Budget 2020: Navigating the Covid-19 Pandemic

• Pandemic Response: Focused on reviving economic growth amid the challenges posed by COVID-19.
• Sectoral Focus: Special attention was given to healthcare, agriculture, and infrastructure development.
• Revised Deficit: The fiscal deficit was revised to 9.5% of GDP due to the pandemic’s economic impact.
• Proposed Spending: ₹30.42 lakh crore aimed at containing the effects of the pandemic and boosting key sectors.

Budget 2019: Vision for the Decade

• 10-Point Vision: The Budget presented a 10-point vision for economic development, infrastructure growth, and social justice.
• Corporate Tax Cuts: Corporation tax rates were reduced to boost growth and attract investment.
• Welfare Schemes: Schemes like Pradhan Mantri Kisan Samman Nidhi and Pradhan Mantri Laghu Vyapari Maan-dhan were introduced to benefit farmers and small traders.
• Proposed Spending: ₹27.86 lakh crore aimed at supporting long-term economic development.

What to Expect in 2025: The Key Areas

As the Union Budget 2025 approaches, the focus will likely be on:

• Tax Reliefs: Anticipated updates for tax slabs, with significant relief expected for middle-income groups earning up to ₹15 lakh annually.
• Cryptocurrency Updates: Proposals for clearer regulation and possible taxation updates for cryptocurrencies.
• Job Creation & Welfare: More focus on providing relief to youth, women, and farmers while driving employment opportunities in various sectors.

To understand more about major expectations from Union Budget 2025-26, click here.

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