Union Budget 2025: A Reformative Leap Forward

M&A Simplification and Regulatory Reforms

The 2025 budget signals a reformative push across various sectors, including M&A. Simplified procedures are set to facilitate easier mergers and acquisitions, fostering a more dynamic business environment.

A regulatory reforms committee will focus on trust-based measures and ease of doing business, reflecting the government's commitment to boosting trade and commerce. Decriminalizing over 100 legal provisions further strengthens this commitment.

“The Hon'ble Finance Minister announced that the merger process will be accelerated through a simplified Fast Track Merger framework, along with an expanded scope to facilitate smoother and more efficient mergers.” - Dhruv Chopra, Managing Partner, Dewan P N Chopra & Co

Relaxation in fast-track merger provisions will help entities to opt for the fast-track route which will reduce the timelines and compliance required as compared to the NCLT route of merger. - Anish Shah, Partner, M&A Tax and Regulatory Services, BDO India

“Scope of fast-track mergers to be expanded to reduce timeline for consolidations.” - Prashant Bhojwani, Partner, Corporate Tax, Tax & Regulatory Services, BDO India

Empowering MSMEs and Startups

India's vast postal network will be transformed into logistics hubs, empowering entrepreneurs, women, and MSME businesses. This initiative leverages a national asset to support small businesses.

A significant boost for startups arrives with a Rs. 10,000 crore infusion into the Fund of Funds, bringing the total allocation to Rs. 20,000 crore. This will further propel entrepreneurship and growth in 27 key sectors.

“Significant increase in limits of turnover and investment for classification as MSME would facilitate a lot of companies to get classified as MSMEs and thereby become eligible for MSME benefits, including access to credit. This measure, coupled with setting up of a new Fund of Funds, with additional funding to start-ups is likely to fuel further growth for start-ups/early stage companies.” - Nitesh Mehta, Partner, M&A Tax and Regulatory Services, BDO India

“Government to increase its commitment by Rs.10,000 crore to setup New Fund of Funds (FoF) to encourage startups in AIF. The FoF for startups with commitments for over Rs 9 lakh crore will encourage the new startups to pool capital via the booming AIF sector.” - Manoj Purohit, Partner & Leader, FS Tax, Tax & Regulatory Services, BDO India

“Increase in Credit guarantee for MSME startups from Rs.10 crore to Rs.20 crore will promulgate the much need ask from the startup sector in larger chunk of capital infusion. Also, the banking sector will aid to expand their lending capacity to such startup companies.” - Manoj Purohit, Partner & Leader, FS Tax, Tax & Regulatory Services, BDO India

Fueling Innovation through DeepTech

A Rs. 20,000 crore investment, including a dedicated DeepTech fund, aims to promote research and development. 10,000 fellowships at IITs and similar institutions will further cultivate innovation hubs.

Tax Reforms: Simplification and Transparency

A new Income Tax Bill promises to revamp the existing 64-year-old act, simplifying tax compliance and enhancing readability. This aligns with the government's "trust first, scrutinize later" approach.

“Hon’ble Finance Minister Just announced that New Income Tax Bill will be introduced next week. The New Income Tax Bill is expected to revamp the 64 years old Act. The new Inncome tax bill is proposed to make tax compliance easier for taxpayers and make the Income Tax Act easier to read and understand.” - Parveen Kumar, Partner - Direct Tax at Dewan P N Chopra & Co

The Jan Vishwas 2.0 Bill will decriminalize over 100 provisions across various laws, further easing compliance and promoting a trust-based environment.

“Hon’ble Finance Minister Just announced that ‘The Jan Vishwas 2.0 Bill seeks to decriminalize over 100 provisions across existing laws.” - Parveen Kumar, Partner - Direct Tax at Dewan P N Chopra & Co