July Budget 2024 Recap: From new tax slabs to green energy boost, key takeaways from first budget of Modi 3.0

Budget 2025: As India awaits the Modi 3.0 government's second full budget announcement today, all eyes are on Union Finance Minister Nirmala Sitharaman. The common man and India Inc are keeping a close watch, and the middle-class taxpayers hope for some relief from a burdensome tax system. 

This will be FM Sitharaman's eighth budget speech. The budget presentation, which will start at 11 am, will be telecast on the official channels of the Indian Parliament, Doordarshan and Sansad TV.

As the clock ticks on the Budget 2025 presentation, let us look back at the previous budget announcement on July 23, 2024. Here is what the Union Budget 2024 planned for India. 

Budget 2024 Recap

• Fiscal Deficit: According to budget data, the fiscal deficit for the financial year 2024-25 was estimated to be 4.9 per cent of the GDP (gross domestic product). The revised estimates for FY2023-24 showed that the fiscal deficit was 5.8 per cent of the nation's GDP, while the budget estimates for FY2023-24 were 5.9 per cent.
• Capital Expenditure: The data also showed that the capital expenditure for the FY2024-25 budget estimates was almost ₹14.96 lakh crore. The revised estimates of the previous year showed that India's capex was at ₹12.71 lakh crore as of FY2023-24 revised figures, compared to the budget estimates of ₹12.70 lakh crore in the same fiscal.
• Total Expenditure: India's total expenditure for the year FY2024-25 was expected to be over ₹47.65 lakh crore, as per the 2024-25 budget estimates in the official Finance Ministry data. The total expenditure for the year 2023-24 was over ₹44.90 lakh crore, as per the revised estimates data, compared to the budget estimates of ₹45.03 lakh crore in the same year. 

India's ‘Viksit Bharat’ Vision

The Union Budget 2024 focused on nine key elements as priorities to generate opportunities in the nation and transform India into a developed country by 2047.

• Increasing productivity and resilience in agriculture
• Providing employment and skilling
• Inclusive human resource development
• Social justice
• Urban development
• Energy security
• Infrastructure
• Innovation, research and development
• Next-generation reforms. 

Agriculture

The government of India announced 109 high-yielding, climate-resilient varieties of 32 field and horticulture crops. They also aimed to transition one crore farmers into natural farming, who would receive support for the next two years.

The Centre promised to create large-scale clusters and promote farmer-producer organisations, cooperatives and startups for the nation's vegetable supply chain. 

Employment

On the jobs front, the Centre had promised to pay one month's salary to a first-time employee enrolled in the Employees' Provident Fund Organisation (EPFO) through a direct benefit transfer of up to ₹15,000 in three tranches.

It was also announced that the government will reimburse EPFO contributions of employers up to ₹3,000 per month for two years for all new recruits.

To promote skill development in the nation, the Budget announced a target to upskill 20 lakh youth over a period of five years from the FY2023-24 budget. The government will set up 1,000 Industrial Training Institutes (ITIs) to help this process.

The prime minister's 12-month internship was also announced, with a monthly allowance of ₹5,000, as per the budget 2024 data. Aiming to help the students, the government also announced its plans to provide internships to 1 crore young individuals in 500 top companies. 

Manufacturing 

The government launched the Credit Guarantee Scheme (CGS) which allows MSMEs to purchase machinery and equipment without any collateral or third-party guarantee.

They also increased the Mudra Loans to ₹20 lakh from the level of ₹10 lakh for entrepreneurs who have availed and successfully repaid other loans.

Financial support of up to ₹10 lakh was also announced for higher education in domestic institutions. The government also plans to set up E-commerce Export Hubs to promote Indian products globally.

The Centre announced that 12 industrial parks under the National Industrial Corridor Development will be sanctioned. 

Housing Needs

As the nation eyed the development of existing cities, the government tried to formulate policies to sustain brownfield redevelopment. They announced the Transit Oriented Development, which aimed to finance 14 large cities with a population above 30 lakh.

Under the PM Awas Yojana Urban 2.0, the Centre announced that 1 crore urban poor and middle-class families will be addressed with an investment of ₹10 lakh crore.

Looking forward, the Centre said that building on the success of the PM SVANidhi Scheme, the nation was aiming to support and develop 100 weekly street food hubs every year for the next five years in selected cities. 

Green Energy

To boost the green energy transition, the government introduced the PM Surya Ghar Muft Bijli Yojana, which aims to install rooftop solar plants to provide 1 crore households with free electricity up to 300 units per month.

Some guidance was provided on nuclear energy. It is expected to play a significant role in India's pursuit of the Viksit Bharat vision. 

Infrastructure

The government announced a provision of ₹1.15 lakh crore for long-term interest-free loans to foster infrastructure investment. Sitharaman also highlighted that the government allocated 3.4 per cent of the GDP to capital expenditure for infrastructure investment.

The government planned to support the development with ₹11,500 crore to projects like intra-state links and other schemes in Bihar, projects in Assam, Himachal Pradesh, Uttarakhand, and Sikkim. 

Taxation

Among the key economic decisions, the finance minister also proposed raising the capital gains tax exemption limit on certain financial assets up to ₹1.25 lakh per year for middle-class and upper-middle-class citizens.

The finance minister also announced the new income tax slabs and highlighted that taxpayers opting for the new regime will get an increased standard deduction of ₹75,000 compared to its previous level of ₹50,000. 

Budget 2024 new Tax Regime slabs:

• Up to ₹3 lakh will pay 0 per cent tax.
• ₹3 lakh to ₹7 lakh will pay 5% income tax.
• ₹7 lakh to ₹10 lakh will pay 10% income tax.
• ₹10 lakh to ₹12 lakh will pay 15% income tax.
• ₹12 lakh to ₹15 lakh will pay 20% income tax.
• Over ₹15 lakh of income will be subject to 30% tax as per the new regime.

According to an earlier report by Mint, the maximum tax savings a salaried individual can get a year under the new tax regime is ₹17,500, after taking into account revisions to the income tax slabs.

This move to lower tax rates in the new regime and remove the deductions comes from the government as an effort to increase the number of taxpayers in the country with lesser tax margins.