Vivek Jalan, Partner Tax Connect Advisory Services LLP
As expected income tax TDS/ TCS provisions have been revamped and rationalized. TDS/TCS are merely advance tax, but there are 71 Sections which cover TDS/TCS, multiple thresholds and multiple rates. Industry had pitched in for complete revamp of TDS/TCS provisions and this budget has moved in the direction. For eg. On same goods purchase, there was a TDS u/s 194Q as well as TCS u/s 206C(1H). This created hardship and in this budget TCS has been scrapped to provide much needed relief. Other TDS thresholds and various compliances has also been rationalized.
Customs duty on capital goods and raw material imports have been rationalized to promote manufacturing, especially on manufacturing of lithium Ion batteries. So the message of the Govt. is very clear – import duty-free but make in India and even export from India.
MSMEs have also been a special focus in this budget. Big reforms are there for leather, footwear, toys, food processing and other MSMEs. Start Ups Tax holiday is also extended.
The Biggest big bang change of course is the exemption of Income Tax for middle class with income upto Rs 12 Lakhs. Even upto income limit of Rs.24 Lakhs per annum, there is a saving of up to Rs.1.1 Lakh per annum. This would provide more disposable income in the hands of middle class.
Amit Sharma, Managing Director & CEO, Tata Consulting Engineers
The Union Budget 2025-26 delivers a transformative push across key sectors, reinforcing India’s commitment to sustainable growth and self-reliance. The National Manufacturing Mission’s focus on cleantech industries, including solar PV cells, EV batteries, electrolysers, and grid-scale batteries, will strengthen domestic value addition and position India as a key player in global clean energy supply chains. Investments in power transmission and distribution, along with electricity distribution reforms, will modernise the sector and ensure financial stability for DISCOMs.
Nuclear energy is a key pillar of India’s energy security and self-sufficiency, supporting a steady shift to cleaner power while keeping the grid stable. The goal of reaching 100 GW of nuclear capacity by 2047 is backed by important reforms, including changes to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act, allowing private sector involvement in nuclear projects. The ₹20,000 crore investment in small modular reactors (SMRs) highlights India’s plan to use its rich thorium reserves for long-term energy independence. These advanced nuclear technologies will provide reliable, scalable, and low-carbon energy, strengthening the country’s energy supply. This approach broadens the energy mix and ensures long-term sustainability by reducing dependence on imported fossil fuels.
Infrastructure remains a key driver of economic growth, with ₹1.5 lakh crore in long-term interest-free loans to states and ₹25,000 crore for maritime expansion, strengthening India’s connectivity and trade competitiveness. The extension of the Jal Jeevan Mission, the ₹1 lakh crore Urban Challenge Fund, and affordable housing initiatives will enhance urban living standards. The Critical Minerals Development Policy, alongside customs duty exemptions on essential resources, ensures a secure supply chain for high-tech industries, supporting India’s ambitions in advanced manufacturing and clean energy. Green bonds and hydrogen R&D incentives further reinforce our commitment to a net-zero future. Tata Consulting Engineers stands ready to contribute through innovative engineering solutions, supporting India’s journey towards a resilient and globally competitive economy.
Manish Sharma, Chairman, Panasonic Life Solutions India & SA
“Overall, a progressive and structured budget focusing on India at 2047 to drive the inclusive GDP growth which we need to get there. There has been a clear focus to providing tax relief to provide more money in hands of people thereby driving consumption. Focusing on the ten broad areas aimed at GYAN (Garib, Yuva, Annadata, and Nari Shakti) Union Budget 2025 paves way for the well-being of end-users, leaving more cash at hand thus, helping drive consumption for the Indian economy. Amongst several benefits, one of the most awaited news for the common man, both for middle class and senior citizens, are the income tax reliefs – which will boost consumer spending and reduce the compliance burden for the businesses.
For the industry there have been several key announcements aimed at fostering manufacturing, growth and strengthening the Indian economy.
•Rationalisation of customs tariff structure is yet another welcome move. The approach of aligning inverted duty structure and increase in BCD on interactive flat panel displays from 10% to 20%, will be an enabler for enhancing manufacturing in India. Reduction of duty in components for manufacturing Open Cell is also in the direction towards making a robust manufacturing base for LCD/ LED television panels in India.
•The announcement on BCD exemption for critical minerals like cobalt is a welcome move and will help India overcome disabilities that exist for manufacturing of lithium-ion batteries as compared to other countries. Additionally, exemption of duty on scrap of lithium-ion batteries will fuel the efficiency and capacity utilization of recycling units that are already in abundance in our country and help enable energy security through energy consumption in our country. It will also catalyse journey towards energy security through energy transition.
•Establishment of Bharat Trade Net is a good move as it will bring commerce, MSME and revenue ministries together and build inter-ministerial dialogues – a unified platform to streamline trade documentation, policy interventions, supply chain efficiencies and financing needs for businesses. This is the need of the hour, further easing and enhancing the international trade and exports.
•The industry awaits the National Manufacturing Mission under the Make in India initiative with a focus on cleantech to help diversify manufacturing across states.
•Enhanced investment and turnover limits for MSMEs aimed at empowering MSMEs will help scale up, innovate, and generate more employment opportunities for the Indian talent further bolstering the manufacturing economy.
•Additionally, establishing five National Centres of Excellence for Skilling reflects a full-circle approach to equipping our youth for ‘Make for India, Make for the World’ manufacturing. The continued push for innovation through 50,000 Atal Tinkering Labs is a commendable step in nurturing scientific temper and creativity among young minds.
These initiatives collectively reinforce India’s path toward self-reliance, competitiveness, and long-term economic growth. This budget is a strong step towards an Atmanirbhar Bharat, ensuring sustainable growth, innovation, and long-term economic resilience.”
Vivek Jalan, Partner Tax Connect Advisory Services LLP on the budget
The Union Budget 2025-26 is for three Ms -Manufacturing, Middle Class and MSMEs. Customs duty on capital goods and raw material imports have been rationalised to promote manufacturing, especially on lithium Ion batteries. MSMEs have also been a special focus in this budget. The Biggest big bang change of course is the exemption of Income Tax for middle class with income upto Rs 12 Lakhs. Further, as expected income tax TDS/ TCS provisions have been revamped and rationalised. There are 71 Sections which cover TDS/TCS having multiple thresholds and multiple rates. Industry had pitched in for complete revamp of TDS/TCS provisions and this budget has moved in the direction. For example, on same goods purchase there was a TDS u/s 194Q as well as TCS u/s 206C(1H). This created hardship and in this budget TCS has been scrapped to provide much needed relief.
Manvendra Shukul, Founder and CEO of Lakshya Digital
“The Union Budget 2025’s emphasis on skilling and artificial intelligence (AI) through the establishment of National Centres of Excellence and AI Centres of Excellence is a great move to cultivate globally competitive talent pool. It will significantly benefit tech-based emerging sectors like gaming.
The allocation of ₹91,000 Cr to Alternative Investment Funds (AIFs) for startups is a substantial commitment to encourage innovation. This funding could fuel setting-up of new game development studios and strengthen India’s gaming ecosystem.
Apart from this, the gaming industry continues to advocate for more targeted support to fully harness its potential as a significant contributor to the economy beginning with rationalized taxation.”
