Budget 2025 Expectations: FM to present Budget on Feb 1- Taxpayers, experts call for higher deductions, lower tax outgo

Satish Chandra Aluri, Lemonn Markets Desk, “The 2025 budget arrives at a critical juncture, with growth forecasts revised to four-year lows, urban demand weakening, and the INR under pressure post-Trump’s surprise victory. As this will be Prime Minister Narendra Modi’s first full budget in his third term, it must balance growth revival with fiscal discipline. Key expectations include renewed focus on infrastructure spending, export promotion via tariff rationalization and MSME support, and targeted tax reforms to boost middle-class consumption. Defence spending is likely to rise in absolute terms, with emphasis on modernization and indigenization. Priority sectors like green energy, semiconductors, and EVs may see enhanced PLI allocations of Rs 30,000- Rs 40,000 crore in the coming months.”

Dev Tripathy, Head of Finance, Philips Indian Subcontinent, said, “Building a future where advanced healthcare is both accessible and affordable to the larger strata of society requires strategic initiatives, and we recognize the continued commitment of the Indian Government in transforming the Indian Healthcare landscape. Over the past years, initiatives aimed at enhancing access to quality healthcare, advancing medical infrastructure and promoting affordable Healthcare solutions have laid a strong foundation for the nation's well-being. The upcoming budget presents an opportunity to also address some of the challenges as India continues to play a pivotal role in the global Healthcare ecosystem. Reducing import duties and taxes on lifesaving devices and high-end medical equipment would be a transformative measure, significantly enhancing access to care and improving public health outcomes.” .

Suresh Darak, Founder, Bondbazaar, said, “Over the past few budgets, tax rates for various investment instruments and income streams have been gradually streamlined, reducing exceptions and differential treatments. This has brought several options, such as Fixed Deposits, Debt Mutual Funds and Bonds, onto a level playing field by taxing them similarly. This alignment eliminates arbitrage opportunities between instruments and fosters a more balanced investment landscape. Looking ahead to Budget 2025, we anticipate further progress in this direction, potentially leading to a uniform tax structure across all asset classes in the coming years.”

Dhiresh Bansal, Chief Financial Officer, Meesho, said, “The Union Budget 2024 introduced significant measures like reduced TDS rates, laying a strong foundation for SMEs and the e-commerce sector. As we look ahead to the Union Budget 2025, we hope for further reforms that simplify taxes and regulations, ease compliance, and strengthen digital infrastructure. Specifically, relaxing the requirement for a Physical Place of Business (PPOB) in every state by enabling a Virtual Place of Business will greatly enhance the ease of doing business for online sellers. Additionally, facilitating the paperless movement of goods for B2C shipments will streamline operations and support the growth of small businesses in India, fostering innovation and inclusive growth in India's digital economy.”

Suman Chowdhury, Executive Director & Chief Economist, Acuité Ratings & Research, said, “The upcoming Budget will likely honour its commitment by substantially increasing agricultural R&D allocations, targeting an uplift from under 0.5% to at least 1% of agricultural GDP. Additionally, fertilizer reforms are anticipated as the government focuses on enhancing domestic production, particularly of nano-liquid urea, to stabilize prices and reduce import dependency.”

He further added that the Budget is expected to focus on agriculture infrastructure, with an emphasis on higher yields, agriculture cluster development, cold storage, warehousing, and supply chain improvements to reduce post-harvest losses and enhance market access, alongside measures for water management, climate change mitigation, and investments in technologies like solar pumps, drones, and precision farming to drive efficiency and innovation.

Paritosh Ladhani, MD, Sincere Developers (owns Taj Hotel and Convention Centre, Agra, and Hard Rock Cafe, Delhi), said, “As India gears up for this pivotal budget there is an overarching need to focus on key sectors like manufacturing, infrastructure, skill development, and consumer empowerment, which are vital for GDP growth. In anticipation of Budget 2025, it is crucial to strike a balance between fiscal consolidation and growth-oriented reforms. The government should aim to stimulate private investment and consumer spending through targeted tax relief, which can increase disposable income and bolster economic activity. Enhancing support for flagship programs such as Make-in-India, Ease of Doing Business, and the Production-Linked Incentive scheme is essential, with particular attention to sectors like manufacturing, food & beverage, and hospitality. These measures can catalyze the next phase of India's economic growth, harnessing the country's demographic dividend and enhancing power consumption.”

Dinesh Gupta, Founder & CEO of Vikalp Online School, said, “Between 2015 and 2024, India allocated approximately 4.1 per cent to 4.6 per cent of its GDP to education. However, National Education Policy (NEP) 2020 set a goal of increasing public investment in education to 6% of GDP. In the upcoming budget of 2025, we hope to see increased allocation for the education sector, and gradually approach the 6% goal. As Vikalp Online School is committed to democratizing K12 education globally, we look forward to policies that encourage schools, universities and online education providers to expand their reach and impact. This budget has the potential to set the stage for transformative growth in education, so that students from all over the world can join Indian institutes for education.”

Abbas Gabajiwala, Founder and CEO of Blix Education, said, “The government makes very specific rules about categories that can confuse business owners like the popcorn example that has become viral, but I wish the government would be able to distinguish between toys like RC cars and toy guns with scientific educational kits, with which students learn about things like electricity, coding and robotics. Kits that schools including government schools use to teach about physics and STEM to their students. Currently they fall under the same category and attract 18% GST. Educational tools like books, stationary etc on the other hand are exempted from GST. Seeing the impact these tools can make on an entire generation, we would hope the government in the budget would consider this.”

Tushar Bhandari, Whole Time Director, Associated Alcohols & Breweries Ltd, said, “With the Indian alcobev industry brimming with potential and new players emerging, the Union Budget 2025-26 should be aligned towards policies that will reduce financial burdens and drive growth. An important expectation would be the reduction in the relatively high excise duty, which severely impacts the cost structures of the manufacturer. It is also crucial that liquor comes under GST so that tax inefficiencies are eradicated. Presently, liquor exclusion prevents companies from availing of GST credits on packaging materials, driving up production costs. The import duty levels at present should be maintained to protect the local manufacturers from cheaper imports. In addition, the regulatory measures should be streamlined so that state policies are harmonized and tax issues that cause disruptions and deter investment are resolved. All these will benefit domestic manufacturers while attracting foreign and domestic investors, leading to long-term growth and innovation in the industry."

Dr Sat Kumar Tomer, Founder & CEO of Satyukt Analytics, said, “The Union Budget 2025 is a pivotal opportunity to drive transformative change in Indian agriculture. As the sector faces increasing challenges from climate variability, resource constraints, and global competitiveness, this year’s budget must prioritize innovation, sustainability, and inclusivity. Investments in agri-tech, particularly in AI, IoT, and satellite data integration, are crucial to empowering farmers with actionable insights. By making precision farming accessible to smallholders, we can enhance productivity while minimizing environmental impacts. Similarly, fiscal incentives for eco-friendly practices such as organic farming and water conservation will position Indian agriculture as a global leader in sustainable food production.”

He also talked about the importance of digital connectivity in rural areas. “By fostering public-private partnerships and scaling innovative solutions, the government can create a future-ready ecosystem where technology and sustainability converge to empower every farmer, ensuring India's agricultural sector thrives in the face of future challenges,” he added.