The expectations for Budget 2025

 The expectations for Budget 2025

The expectations for Budget 2025 could vary depending on economic conditions, government priorities, and market trends. However, here are some general areas that people typically watch out for:

 1. Tax Relief: Many are hoping for personal income tax cuts, especially for the middle class, to boost consumption and savings. Companies may also expect corporate tax relief to encourage investment and job creation. 

 2. Infrastructure Investment: With infrastructure playing a key role in economic recovery, there may be announcements of increased funding for roads, railways, ports, airports, and green energy projects.

 3. Digital and Tech Support: Given the increasing focus on technology, there could be provisions for enhancing digital infrastructure, supporting startups, and encouraging innovation, especially in the fields of AI, blockchain, and cybersecurity.

 4. Support for MSMEs: Micro, Small, and Medium Enterprises (MSMEs) have been under pressure, so the government may introduce measures for easier access to credit, tax breaks, and simplification of regulations.

 5. Healthcare and Education: Investments in healthcare, including public health infrastructure and affordable care, are expected to continue. Education reforms or funding for skill development programs may also be priorities. 

 6. Agriculture and Rural Development: Expecting schemes that support farmers, agricultural technology, and rural development to drive job creation in rural areas.

 7. Sustainability and Green Initiatives: In line with global trends, there could be announcements for more incentives for renewable energy projects, electric vehicles, and sustainable agriculture.

 8. Social Welfare: Increased allocations for welfare schemes for the underprivileged, including food security, housing, and social safety nets, could be expected. 

 9. Inflation Control: Measures to curb inflation and reduce cost pressures on consumers might be a focus, such as reducing the GST on certain goods or providing subsidies.

For Budget 2025, the specific expectations regarding Investments and Long-Term Capital Gains (LTCG) could focus on the following areas:

 1. Taxation on LTCG: • Exemption/Reduction in Tax Rates: There might be expectations for relief on LTCG tax rates for equity investments. Currently, LTCG on equity is taxed at 10% above ₹1 lakh in a financial year. Some might hope for a reduction in this rate or a potential increase in the exemption threshold. 

 • Indexation Benefit for LTCG: There's also a demand for restoring indexation benefits for long-term capital gains from equity, which was previously available for debt-oriented instruments. Restoring this could benefit long-term equity investors by reducing the effective tax burden.

 2. Tax-free Bonds & Fixed Income: • Incentives for Fixed Income Investments: Tax-free bonds have been popular in previous budgets, so there may be an expectation for new issues or tax breaks on interest income from such bonds. Investors may hope for an increase in the scope of tax-free bond options.

 • Reduction in Tax on Fixed Deposits (FDs): Some investors are looking for relief from the high tax on interest income from fixed deposits, especially for senior citizens.

 3. Mutual Funds: • Incentives for Mutual Fund Investments: There may be an emphasis on encouraging investments in mutual funds, especially in retirement and tax-saving schemes. Expanding the scope of ELSS (Equity Linked Savings Schemes) or enhancing the Sukanya Samriddhi Scheme might be seen as beneficial for long-term investments. 

 • SEBI’s Role in Investor Protection: Measures for enhancing transparency and investor protection in mutual fund schemes might also be on the agenda.

 4. Capital Market Reforms: • Boosting Liquidity in the Market: Measures to enhance liquidity and accessibility for retail investors, like reforms in the primary and secondary markets, could be expected. • Revisiting Taxation of Dividends: The Budget might address the tax treatment on dividends (which were made taxable in the hands of investors since 2020) to simplify or provide relief to investors, especially those relying on dividend income from stocks and mutual funds.

 5. Encouraging Long-Term Investments: • Encouraging Retirement Funds: The government may propose tax incentives to encourage investments in long-term retirement schemes, like NPS (National Pension Scheme), PPF (Public Provident Fund), or other pension schemes that provide long-term tax benefits.

 • Sustainability-Focused Investments: With a global shift toward sustainability, there may be incentives for investments in green bonds or • ESG (Environmental, Social, and Governance) funds that align with long-term growth prospects. 

 6. Sovereign Gold Bonds (SGB): • Further Incentives for Gold Investment: There could be more incentives or promotional measures to encourage investment in Sovereign Gold Bonds or other non-physical gold assets, which are more tax-efficient compared to physical gold.

 7. Startup and Venture Capital Incentives: • Tax Benefits for Startups: There may be continued or enhanced tax incentives for investors who put their money in start-ups or venture capital funds, to encourage innovation and risk-taking in emerging sectors like AI, tech, and renewable energy

. 8. Taxation of International Investments: • Relief for NRIs and Foreign Investors: Provisions for reducing tax burdens on international investments or ease of repatriation of funds may be discussed to attract more foreign investments into India.