Finance Minister Nirmala Sitharaman presented her record seventh consecutive Union Budget 2024-25 today, July 23, during the Budget Session of Parliament, focusing on economic growth, fiscal stability, and development initiatives.
The Budget 2024-25 holds promises and significance for HR leaders in many ways as organizations are grappling with work dynamics, talent management, and technological disruptions.
The budget addresses critical areas that impact both employers and employees. In this brief overview, we’ll explore the most relevant highlights for HR professionals and the broader workforce.
The budget includes increased spending, job creation, and tax relief for the middle class. FM Sitharaman said that the Budget is focused on the middle class, employment, skilling, and MSMEs.
Union Budget 2024-25: Announcement for Employment and Skilling
Three employment-linked schemes are to be launched based on enrolment in the EPFO. The budget proposes to allocate Rs 2 lakh crore for job creation over 5 years. New employment skilling scheme to provide skills to 20 lakh youth in 5 years, says FM Sitharaman.
One-month wage to all new employees is to be provided as a direct benefit transfer in three installments up to Rs 15,000 to first-time employees, as registered in the EPFO. The eligibility salary limit will be Rs 1 lakh per month. The scheme will benefit 2.1 lakh youth.
Working women hostels and creches to be opened to facilitate higher participation of women in the workforce. The government will reimburse to employers up to Rs 3,000 per month for 2 years towards their EPFO contribution for each additional employee. The scheme is expected to incentivize additional employment of 50 lakh persons.
Union Finance Minister Nirmala Sitharaman said that to provide on-the-job training to youth, the government will launch an internship scheme to provide opportunities to 1.0 crore youths in the top 500 companies over the next five years.
Companies providing the internship, she explained, will cover the training and 10% of the associated costs using their Corporate Social Responsibility funds. She proposed that for the interns to get exposure to real-life environments an internship allowance will be provided of Rs. 5,000 per month.
Ethical AI Practices and Guardrails
The budget recognizes the importance of ethical AI. Guardrails are essential to prevent biases and misuse. Governance regulations, tools like model cards, and cybersecurity mechanisms are crucial.
Also Watch: How GenAI Transforms Hiring and Recruitment, Click Here
Union Budget 2024-25: Tax Slabs and Personal Taxation
Finance Minister Nirmala Sitharaman, presenting Budget 2024 today proposes new Income Tax slabs for FY 2024-25. Here’s the breakdown:
- 0 to Rs. 3 lakh: Nil
- Rs. 3 lakh to Rs. 7 lakh: 5%
- Rs. 7 lakh to Rs. 10 lakh: 10%
- Rs. 10 lakh to Rs. 12 lakh: 15%
- Rs. 12 lakh to Rs. 15 lakh: 20%
- Above Rs. 15 lakh: 30%
Additionally, the standard deduction has been increased from Rs. 50,000 to Rs. 75,000 under the new income tax regime. These changes aim to put more money in the hands of taxpayers and encourage consumption.
Summing Up!
The budget is a blend of optimism, challenges, and opportunities. The government’s approach is all-encompassing: “sarvāṅgīṇ, sarvasparśī, aur sarvasamāveśī.” Translation: holistic, inclusive, and pervasive. This aligns with HR’s role in creating an inclusive workplace and supporting diverse talent.
Industry Reactions
Pallavi Jha, Chairperson & MD of Dale Carnegie India & Walchand PeopleFirst, said, “The 2024-25 Union Budget must address both immediate job creation and the long-term sustainability of employment growth. While the ₹1.48 lakh crore allocated for education, employment and skilling is necessary, it may fall short given the scale of the job crisis and regional disparities.”
“To make a real impact, initiatives like EPFO incentives, skilling programs and the MSME credit guarantee scheme must align with the evolving needs of industry sectors. This approach will create targeted job opportunities and equip graduates with the skills needed to build a resilient workforce. Beyond funding, the focus must be on program quality and measurable outcomes to ensure effective implementation across credit support, mentorship, and market opportunities,” she concluded.
Also Watch: How GenAI Transforms Workplace Experience and Culture, Click Here
Anish Singh, Co Founder of All Things People, a HR Tech Startup, said, “The Budget 2024-25 brings promising advancements for India’s future workforce and startup ecosystem. The comprehensive scheme to provide internships in ‘500 top companies to one crore youth over the next five years is a visionary step towards bridging the skills gap and ensuring our young professionals are industry-ready. The abolition of the angel tax comes as a much-needed relief for startups, especially amidst a funding slump.
“As an HR tech company, we are particularly excited about these developments. They align perfectly with our mission to harness technology for workforce development and support the growth of a vibrant startup ecosystem in India. These measures introduced in the budget are poised to revitalize the startup landscape, fostering innovation and entrepreneurship across the nation,” he added.
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