1 crore more people to pay no income tax; ₹11.21 lakh crore capex: Key figures from Budget 2025-26

The Union Budget 2025 has brought major income tax relief, with 1 crore more taxpayers expected to pay no income tax due to an increase in the tax rebate threshold to ₹12 lakh per annum.

Presenting the Budget, Union Finance Minister Nirmala Sitharaman on Saturday said "government has put substantial amount of money in hands of people" through I-T rate rejig responding to the voice of people.

"One crore more people will pay no income tax due to hike in rebate to Rs 12 lakh," she said at the post-Budget press conference.

Key tax measures in Budget 2025

The rebate threshold has been raised from ₹7 lakh to ₹12 lakh, putting more disposable income in taxpayers’ hands.

"One crore more people will pay no income tax due to this rebate," Sitharaman said at a post-Budget briefing.

• Up to ₹4 lakh – No tax
• ₹4-8 lakh – 5%
• ₹8-12 lakh – 10%
• ₹12-16 lakh – 15%
• ₹16-20 lakh – 20%
• ₹20-24 lakh – 25%
• Above ₹24 lakh – 30%

Tax buoyancy and revenue projections

Finance Secretary Tuhin Kanta Pandey said tax buoyancy, a measure of revenue growth relative to GDP growth, is expected at 1.42 in FY26, down from 2 in the current fiscal.

"We have assumed a moderate tax revenue buoyancy due to the revenue sacrifice from the increased rebate," he said.

Pandey noted that three-fourths of individual tax filers have already moved to the new income tax regime.

"We expect every taxpayer to shift eventually," he added.

Capex and Fiscal Targets

Fiscal deficit target for FY26: 4.4% of GDP, down from 4.8% in FY25.

The Indian economy is expected to grow at 6.3-6.8% in FY26, below the 8% target needed for Viksit Bharat 2047 vision.