April 2025 shall mark crucial financial alterations that have to do with your income, savings, and loans. Among such changes are the cuts in income tax and a decrease in the repo rate. If the rumors are to be believed, the financial burdens of millions can be lightened by these amendments.
The introduction of DigiLocker to store investment statements will further ease the process of maintaining financial records. Let’s look at some of the significant game-changers and their impact on your finances.
New Tax Regime Offers Major Relief
As the government is phasing out the benefits the old system used to provide, the new tax regime continues to be looked at more and more favorably. For Budget 2025, Finance Minister Nirmala Sitharaman raised the income tax exemption limit to ₹12 lakh, providing a boon to taxpayers.
Thus, New Tax Scheme Key Benefit:
- A taxpayer whose annual income is ₹12 lakh will save ₹83,200 (including cess).
- Someone who earns ₹16 lakh would pay ₹52,000 in less income tax.
- Those at the top echelon earning above ₹1 crore will find the tax saving more than ₹1.25 lakh.
With 72% of taxpayers already having adopted this regime in FY24, this number is only going to increase. It would be interesting to see how this significant change in the overall tax structure would result in a remarkable inflow in disposable income for an individual, irrespective of the income ceiling they are coming from, according to experts from Deloitte India.
Will RBI Cut the Repo Rate Again?
In February 2025, the Reserve Bank of India (RBI) cut the repo rate to 6.25% by 25 basis points (bps), the first such move in nearly five years. With retail inflation dropping to 3.61% below the central bank’s target of 4%-economists are predicting yet another 25 bps cut in April.
What This Means for Borrowers:
- Home loan EMIs could decrease further if banks pass on the rate cut benefits.
- A Reuters poll (March 2025) indicated that 54 out of 60 economists expect the repo rate to drop to 6% in April.
That said, some of the private banks have been pretty slow to adjust fully their lending rates, so borrowers should check with their lenders.
If the RBI proceeded with another rate reduction, it would further encourage spending and investment to benefit both businesses and consumers.
DigiLocker for Investment Statements: A Game-Changer
Investors can begin as of April 1, 2025, to save all their demat account statements and Consolidated Account Statements (CAS) in DigiLocker. The move by SEBI aims to:
- Reduce unclaimed investments by providing easy access to financial records.
- Provide an alternative through which users can nominate a trusted person who could access the investment details in unforeseen situations.