The Finance Minister presented a ₹50 lakh crore budget in a 1 hour 17-minute speech. Given its complexity, understanding its impact on everyday life can be challenging. To make it simpler, Bhaskar’s experts have decoded eight key points that you should know. One of the biggest takeaways from this budget is tax relief for the middle class. Income up to ₹12 lakh will not be taxed, and salaried individuals will receive an additional standard deduction of ₹75,000. This effectively makes income up to ₹12.75 lakh tax-free. However, this benefit comes with two important conditions. It applies only to those who have opted for the new tax regime, meaning individuals following the old tax regime will not be eligible. Additionally, this exemption is primarily for salaried individuals. If someone has income from capital gains, such as investments in the stock market, mutual funds, or real estate transactions, this provision will not apply to them. Government to face ₹1 Lakh crore revenue loss Following the changes in income tax, the central government is expected to incur a revenue loss of ₹1 lakh crore in direct tax and ₹2,600 crore in indirect tax. However, a serious portion of this amount is likely to flow back into the system. For instance, if a taxpayer saves ₹10,000 due to the revised tax structure and spends ₹8,000 on shopping, a part of that amount will return to the government through GST, customs duty, and other indirect taxes. As a result, the overall financial impact on the government will be limited. More money in hand to boost the economy With 85% of the population earning less than ₹12 lakh, the new tax changes will leave people with extra savings, encouraging them to spend more. This increased spending will benefit sectors like FMCG, auto, and real estate, driving economic growth. The budget follows a consumption-led growth model, based on the economic principle of the virtuous cycle—where higher spending boosts production, leading to more jobs, increased incomes, and further demand. This continuous cycle helps sustain economic expansion. Signs of phasing out the old Tax regime The budget has made no changes to the old tax regime, nor was it discussed in parliament. While the old system offers exemptions under Section 80C and other deductions, the latest announcements make the new tax regime more attractive. With the upcoming new income tax bill, the government may set a timeline—possibly 2, 3, or 4 years—to phase out the old tax regime entirely. The intent is clear: moving towards a single, simplified tax system under the new regime. Two major announcements besides income tax Apart from income tax, the budget introduced key changes in Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). Under Section 194A, the TDS exemption limit on interest income for senior citizens has been raised from ₹50,000 to ₹1 lakh, while for others, it has increased from ₹40,000 to ₹50,000. This means fewer taxpayers will need to file returns solely to claim TDS refunds. As a result, tax compliance becomes simpler, and individuals will have more money at their disposal. Agriculture declared as the 'Sector of the future' The government has placed a strong emphasis on agriculture, recognising it as the 'Sector of the Future' in the Economic Survey. To reduce dependence on imports, a pulses mission has been launched, encouraging farmers to boost the production of pulses and mustard oil alongside rice and wheat. Additionally, the Kisan Credit Card loan limit has been increased from ₹3 lakh to ₹5 lakh, providing financial support to 7.7 crore farmers and strengthening the agricultural sector. Expert panel: