Budget 2025: No income tax on earnings up to Rs 12 lakh, Kisan Credit Card limit raised to Rs 5 lakh

Union Finance Minister Nirmala Sitharaman presented the 2025-26 Budget in Parliament on Saturday, February 1. The biggest announcement for the middle class: no income tax on annual income of up to Rs 12 lakh under the new tax regime.

For salaried employees, the limit works out to Rs 12.75 lakh once the Rs 75,000 standard deduction is included. Until now, the rebate under the new regime applied to income of up to Rs 7 lakh.

According to the government, a taxpayer earning Rs 12 lakh will save Rs 80,000. Special-rate income, such as capital gains, will still be taxed.

For farmers, the limit for cheaper loans through the Kisan Credit Card has been raised from Rs 3 lakh to Rs 5 lakh. The scheme serves 7.7 crore farmers, fishermen and dairy farmers.

The Finance Minister also announced the Prime Minister Dhan-Dhaanya Krishi Yojana. Run with state governments, it will focus on 100 districts with low farm productivity and is expected to help 1.7 crore farmers.