The Indian Reserve Bank said in its latest bulletin published on February 19 that it is expected that the reduction of taxes in the budget of the Union 2025 and the alleviation of inflation will strengthen household consumption. This was repeated by the newly appointed Governor RBI Sanjay Malhotra in the February announcement of monetary policy session.
'On the direct tax front, the budget proposes the tax relief of RS 1 Lakh Crore focused on middle -class taxpayers, which are expected to strengthen income for available home and stimulate consumption, savings and investment. In the area of indirect taxation, the revised overall obligations focus on the tariff simplification and solves the inversions of the CLA, ”said Bulletin in the assessment of the Union 2025 budget.
She stated that the ratio of gross tax GDP is budget to increase to 12 % in 2025-26, which is the highest after 2007-08.
“The tax relief is expected to strengthen one -off income and provide support for consumption and investment of households,” he said. The Budget of the Union 2025, presented by the Minister of Finance Nirmala Sithaman 1.
Income tax boards were also revised in all income. It is estimated that the total income that the government gives up is around Rs 1 lakh crore in direct taxes and 2,600 CRS in indirect taxes.
RBI reported that the Union 2025 budget has caused pressure to increase consumption while maintaining the quality of expenditure with an effective capital expenditure/ GDP ratio budget to an improvement of 4.3 % in 2025-26 of 4.1 % in 2024-25 (re) .
In the February MPC Governor Malhotra stated that “rural demand remains on UPTRED, while cities consumption remains muted high -frequency indicators providing mixed signals”. “In the future, improving employment conditions, tax relief in the Union's budget and alleviating inflation, along with a healthy agricultural activity for household consumption,” he said.
In its statement, MPC also stated that “household consumption will remain robust supported tax relief in the Union 2025-26 budget”.
