The Union Finance Minister Nirmala Sitharaman is presenting her record eighth Union Budget 2025-26 in Parliament amid high hopes of tax relief. Delivering the first full budget of Third Narendra Modi-government , Nirmala Sitharaman has become the only finance minister to present the Union Budget for eight consecutive times.
Among the key announcements in her speech was a significant proposal to rationalize the customs tariff rate structure for industrial goods, aimed at simplifying the tax regime and boosting trade efficiency.
Union Budget 2025: Key Highlights
As part of a comprehensive review of the customs rate structure announced in the July 2024 Budget, the Finance Minister proposed several measures to streamline the system. First, she announced the removal of seven additional tariff rates, building on the seven rates eliminated in the 2023-24 Budget. This reduction will leave only eight tariff rates, including the ‘zero’ rate, making the customs structure simpler and more predictable for businesses.
To ensure minimal disruption, the government will apply appropriate cesses to broadly maintain the effective duty incidence on most items. However, a few items may see a marginal reduction in duty incidence. Additionally, the Finance Minister proposed limiting the levy to not more than one cess or surcharge per item. As part of this effort, the Social Welfare Surcharge will be exempted on 82 tariff lines that are already subject to a cess.
[BREAKING] No Income Tax upto Rs. 12 Lakh Income, proposes FM during Budget 2025
In a move to provide relief to patients, particularly those suffering from cancer, rare diseases, and other severe chronic conditions, the Finance Minister proposed adding 36 lifesaving drugs and medicines to the list of items fully exempted from Basic Customs Duty (BCD). Furthermore, six lifesaving medicines will be added to the list attracting a concessional customs duty. These exemptions and concessions will also apply to the bulk drugs used in the manufacture of these medicines.
Additionally, the Budget expanded the scope of exemptions for drugs and medicines supplied under Patient Assistance Programmes run by pharmaceutical companies. Medicines provided free of cost to patients under these programmes will now include 37 more drugs and 13 new patient assistance programmes, ensuring greater access to essential treatments for those in need.
These reforms are expected to simplify the customs structure, reduce compliance burdens, and enhance ease of doing business, while also addressing critical healthcare needs. By rationalizing tariffs and providing targeted relief, the government aims to create a more efficient and equitable trade environment, supporting India’s economic growth and development goals.
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