'Goddess Lakshmi's blessings'; No income tax payable on income up to 12 lakhs, Kerala's demands rejected

NEW DELHI: As indicated by the Prime Minister earlier, middle-income earners and salaried employees have received significant tax relief. Individuals, including government employees, earning up to Rs 12 lakh annually will not face any additional income tax. With the Delhi assembly election set for February 5, the budget announcement appears to be a strategic effort to appeal to voters. Furthermore, with Bihar also heading to the polls this year, multiple initiatives have been introduced for the state.

However, Kerala did not receive special allocations despite requesting packages for Wayanad, AIIMS, and Vizhinjam Port. In contrast, Bihar received multiple development initiatives, including the expansion of the Patna airport, Western Koshi Canal project funding, tourism projects, and a Food Technology Management Institute.

At the same time, the government has introduced a Maritime Development Fund with a budget of Rs 25,000 crore to support the blue economy sector. This is the second budget presented by Finance Minister Nirmala Sitharaman under the third Modi government.

For Kerala, the only announced initiative was funding for infrastructure development at IIT Palakkad. However, the budget includes a Rs 1.5 lakh crore interest-free loan for state development projects and another Rs 1.5 lakh crore Urban Challenge Fund to support urban development, which may indirectly benefit Kerala.

The defence sector received an allocation of Rs 6.81 lakh crore (up from Rs 6.2 lakh crore in 2024).

To compete with China in Artificial Intelligence
A new Centre of Excellence in AI, with a capital outlay of Rs 500 crore as part of efforts to compete with China.
Project to make India the global toy hub of the world
MSMEs will receive loans up to Rs 10 crore with relaxed repayment terms.
Enhanced loans up to Rs 20 crore for startups
Export companies can avail themselves of term loans of up to Rs 20 crore.

Rs 5 lakh loan for farmers
Farmers will get Rs 5 lakh in loans through the Kisan Credit Card scheme.
UPI-linked credit cards with a limit of Rs 30,000 will be introduced under the PM Svanidhi Scheme
The government will provide gig workers with identity cards and register them on the e-Shram portal. They will also receive healthcare under the PM Jan Arogya Yojana.

Prices of medicines will come down
Prices of 36 essential life-saving medicines, including cancer drugs, will be reduced.
Several drugs will be completely exempted from basic customs duty.
The duty on six other life-saving drugs will be cut to 5%.

Price reductions

• Mobile phones
• LED and LCD TVs
• EV and mobile phone batteries
• Open cells in LED, and LCD TVs
• Lithium-Ion battery
• Camera modules and connectors
• USB cables
• Imported vehicles

Reduction in gold prices
Customs duty on gold ornaments has been reduced from 25% to 20%, which is expected to boost the gold market. This change takes effect today.
Platinum jewelry tax has been reduced from 25% to 6.4%.

Increase in prices

• Interactive Flat Panel Displays (IFP)
• Woven Fabrics (Textiles)

No Income Tax for annual income up to Rs 12 Lakh
7.5 crore taxpayers will benefit, but government revenue will decline by Rs 1 lakh crore.
The new tax scheme, introduced last year, will be the basis for this benefit. The old scheme, which allowed deductions for home loan repayments, insurance premiums, etc., will become irrelevant.
Individuals earning up to Rs 1 lakh per month will not have to pay any income tax.
Salaried employees will benefit from a Rs 75,000 standard deduction, making annual incomes up to Rs 12.75 lakh tax-free.
Senior citizens will not face TDS on interest earnings up to Rs 1 lakh. The rental income TDS limit has been increased from Rs 2.4 lakh to Rs 6 lakh.
TCS on education loans from financial institutions has been removed.