Budget provides ‘marginal relief’ for those taxpayers whose income exceeds ₹12 lakh p.a., says Sitharaman

Finance Minister Nirmala Sitharaman announces unprecedented tax relief and realistic growth projections in personal income tax collection.

Finance Minister Nirmala Sitharaman on Tuesday (March 25, 2025) said the Finance Bill 2025 provides unprecedented tax relief, and the 13.14% projected growth in personal income tax collection is "realistic" and supported by solid data.

Replying to the discussions on Finance Bill 2025 in the Lok Sabha, Ms. Sitharaman also said the customs duty rationalisation announced in the Budget will support manufacturing units, domestic value addition, promote exports, facilitate trade and also provide relief to the common people.

Union Budget 2025: Tax bonanza for middle class 

In the 2025-26 Budget, the government has hiked income tax rebate to ₹12 lakh per annum from ₹7 lakh earlier. For the salaried class, this rebate will be ₹12.75 lakh per year after taking into account the standard deduction. The hike in I-T rebate will lead to tax foregone to the tune of ₹1 lakh crore in FY26.

Ms Sitharaman said the Budget also provides "marginal relief" under the Income Tax law for those taxpayers whose income exceeds ₹12 lakh per annum by a small margin.

"The Finance Bill provides unprecedented tax relief to honour taxpayer... We have recognised the contribution of the middle class," she said.

Collections in personal income tax have shown considerable buoyancy in the last few years and they have been increasing around 20% year-on-year, the minister added.