3, Feb 2025
Budget 2025: Prashant Thacker’s Reaction on Fiscal Measures

Prashant Thacker, Partner at Thacker & Associates (CA Firm)

“This Budget strikes a balance between immediate tax relief and long-term structural reforms that will shape India’s economic path. The no income tax announcement up to ₹12 lakh is a transformative move, directly benefiting millions of salaried individuals and significantly boosting disposable income. This step is expected to stimulate private consumption, which is already a key pillar of India’s GDP, accounting for nearly 60% of economic activity.

On the corporate front, the rationalization of TDS and TCS addresses long-standing compliance challenges, making tax administration more efficient and reducing friction for businesses. The introduction of a three-year block approach for transfer pricing aligns India with global best practices, providing multinational companies with greater certainty and encouraging further investment in the country.By simplifying merger approvals, widening the fast-track merger framework, and expanding safe harbor provisions, the Budget takes meaningful steps toward reducing regulatory bottlenecks.

The government’s continued push for the International Financial Services Centre (IFSC) in Gujarat, with incentives now extending to shipbuilding, ship leasing, and global treasury operations, signals India’s intent to strengthen its presence in international finance. This will make India a competitive player in the global financial ecosystem, challenging established hubs like Singapore and Dubai. Similarly,increasing the FDI cap in insurance from 74% to 100% is a strategic decision that encourages foreign investment while ensuring that premiums remain within the country—a balanced approach to attracting global capital without risking domestic outflows.
Beyond taxation, the ₹10 lakh crore asset monetization plan offers a structured financing model for infrastructure projects, particularly through the sale of road assets. This initiative is expected to unlock significant capital for infrastructure development, creating jobs and driving economic growth. Overall, this Budget does not merely introduce incremental changes—it lays the groundwork for a more streamlined and investment-driven economy.”

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