Budget 2025: Good News on Cards! Crucial Changes in Income Tax Slabs Likely, Report

Budget 2025: Nomura, a global financial services firm, has outlined its expectations for the Union Budget 2025-2026, forecasting key changes in income tax slabs and fiscal strategies aimed at boosting economic growth and consumer spending. The firm anticipates both fiscal consolidation and growth-supportive measures from the government.

Budget 2025: Potential Changes in Income Tax Slabs

Nomura predicts that the upcoming Budget 2025 will introduce significant revisions to the income tax slabs, aimed at stimulating consumer spending. These changes are expected to reduce the tax burden on individuals, enhancing disposable income and encouraging economic activity. The government's focus on adjusting income tax norms will be part of broader fiscal measures to drive growth.

Income Tax Measures and Fiscal Consolidation

According to Nomura’s report, the government is likely to introduce changes that support both fiscal consolidation and measures to sustain growth. The income tax reforms are seen as a key element of these measures. By adjusting income tax slabs, the government may aim to provide relief to taxpayers, which could help balance both the fiscal deficit and economic expansion goals.

Forecasts for Budget 2025 and Economic Outlook

Nomura expects India to slightly exceed its fiscal deficit target for FY 2025, with a forecast of 4.8% of GDP. This is attributed to a reduction in capital expenditure, although public capital spending is expected to grow by 12.5% in FY 2026. The Budget 2025 may also include several other initiatives, such as lowering corporate tax rates, increasing investments in agriculture, and adjusting customs duties, further supporting economic growth.