Finance Minister Announces Key Tax Reforms And Incentives For EV And Mobile Battery Production In Budget 2025-26

Finance Minister Announces Key Tax Reforms and Incentives for EV and Mobile Battery Production in Budget 2025-26

Finance Minister Nirmala Sitharaman, in her Budget for 2025-26, announced measures aimed at simplifying the tax system, including the rationalization of the Tax Deduction at Source (TDS) regime to reduce compliance burdens. She emphasized that the tax proposals focus on income tax reforms for the middle class, TDS streamlining, and easing compliance.

The government will also introduce a new Income Tax (I-T) bill in Parliament next week. Sitharaman highlighted that reforms are a means to achieve effective governance, and the new bill will be more concise, halving the current volume and ensuring clarity in its language.

Additionally, the government plans to increase the threshold for Tax Collected at Source (TCS) on remittances under the Reserve Bank of India’s liberalized remittance scheme from Rs 7 lakh to Rs 10 lakh.|

Sitharaman also announced that 35 more goods related to electric vehicle (EV) batteries and 28 additional items for mobile phone battery production would be added to the list of exempted capital goods.