Finance Minister Nirmala Sitharaman on Tuesday presented the Union Budget 2024-25 during the Monsoon Session of Parliament, marking her seventh consecutive budget speech and surpassing former Prime Minister Morarji Desai’s record of six consecutive budgets between 1959 and 1964.
In this landmark budget, Sitharaman outlined priorities aimed at fostering economic growth and creating ample opportunities. Key focus areas include productivity and resilience in agriculture, employment, skilling, and services.
“India’s economic growth continues to be the shining exception in a world gripped by policy uncertainties and will remain so in the years ahead,” Sitharaman said while presenting the budget. “In this budget, we particularly focus on employment, skilling, MSMEs, and the middle class.”
Measures for Salaried Persons and Job Seekers
One of the significant announcements in the budget was the increase in the standard deduction for salaried employees from ₹50,000 to ₹75,000 under the new income tax regime, marking a 50% increase. This move aims to provide substantial relief to salaried individuals.
Additionally, the finance minister announced new income tax slabs for the current fiscal year under the new tax regime:
- Up to ₹3 lakh: 0%
- ₹3 to ₹7 lakh: 5%
- ₹7 lakh to ₹10 lakh: 10%
- ₹10 lakh to ₹12 lakh: 15%
- ₹12 lakh to ₹15 lakh: 20%
- Above ₹15 lakh: 30%
“As a result of these changes, a salaried employee in the new tax regime stands to save up to ₹17,500 in income tax,” Sitharaman stated.
For pensioners, the budget proposes increasing the family pension deduction amount from ₹15,000 to ₹25,000. “Deduction on family pension for pensioners is proposed to be enhanced from ₹15,000 to ₹25,000,” Sitharaman noted, highlighting that this will provide relief to about 4 crore salaried individuals and pensioners.
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Employment and Skilling Initiatives
A key highlight of the budget is the provision of a one-month wage to all persons newly entering the workforce in formal sectors. The government will directly transfer this amount to employees as their provident fund contribution.
“One month’s wage to all persons newly entering the workplace in all formal sectors. Direct Benefit Transfer of one month’s salary in three instalments to first-time employees as registered in the EPFO will be up to ₹15,000. The eligibility limit will be a salary of ₹1 lakh per month. The scheme will benefit 210 lakh youth,” Sitharaman explained.
Moreover, incentives will be provided to both employees and employers based on their EPFO contributions in the first four years of employment. Employers will be reimbursed up to ₹3,000 per month for two years towards their EPFO contribution for each additional employee.
Internship Scheme for Youth
Sitharaman also announced an internship scheme targeting 10 million young people over five years, covering 500 top companies. The scheme includes an internship allowance of ₹5,000 per month and a one-time assistance of ₹6,000.
“As the 5th scheme under the Prime Minister’s package, our government will launch a comprehensive scheme for providing internship opportunities in 500 top companies to 1 crore youth in five years. They will gain exposure for 12 months to real-life business environments, varied professions, and employment opportunities,” Sitharaman said. “Companies will be expected to bear the training cost and 10% of the internship cost from their CSR funds.”