BUDGET (2026-2027) OVERVIEW

The Union Budget 2026–27, presented on 1 February 2026, is anchored in the vision of "Viksit Bharat 2047". It introduces a landmark New Income Tax Act, 2025 and prioritises infrastructure, manufacturing, and "Yuva Shakti" (Youth Power) while maintaining fiscal discipline.
1. Personal Finance and Taxation
The center-piece of the budget is the Income Tax Act, 2025, replacing the 1961 Act starting 1 April 2026 to simplify compliance and reduce litigation.
  • Income Tax Slabs: Rates remain unchanged, but the effective tax-free income remains ₹12 lakh under the New Tax Regime due to a ₹60,000 rebate.
  • Deductions: Salaried employees continue to benefit from a ₹75,000 standard deduction, making income up to ₹12.75 lakh tax-free.
  • Senior Citizens: The deduction limit has been doubled from ₹50,000 to ₹1 lakh.
  • Simplified Compliance: Revised returns can now be filed until 31 March (previously 31 December). A one-time 6-month amnesty scheme for disclosing small foreign assets (under ₹20 lakh) has been introduced for students and NRIs.
2. Financial Sector and Stock Market
  • Derivatives Tax (STT): Securities Transaction Tax on Futures increased to 0.05% (from 0.02%) and on Options to 0.15% to curb excessive speculation.
  • Share Buybacks: Profits from buybacks will now be taxed as Capital Gains for all shareholders.
  • Corporate Tax: The Minimum Alternate Tax (MAT) is becoming a final tax at a reduced rate of 14% (down from 15%).
3. Key Sector Allocations
The government has significantly increased public capital expenditure (Capex) to ₹12.2 lakh crore for FY27.
SectorAllocation (FY27)Key Highlights
Infrastructure₹12.2 lakh crore7 High-Speed Rail corridors (e.g., Mumbai-Pune, Delhi-Varanasi); 20 new National Waterways.
Defence₹7.85 lakh croreFocus on modernising forces with a 75% domestic procurement mandate.
Agriculture₹1.63 lakh croreLaunch of Bharat-VISTAAR (AI agri-tool) and development of 500 Amrit Sarovars.
Education₹1.39 lakh croreContent Creator Labs in 15,000 schools; 5 university townships near industrial corridors.
Healthcare₹1.06 lakh croreEstablishing 5 Regional Medical Hubs and training 1.5 lakh multiskilled caregivers.
4. Fiscal Indicators
  • Fiscal Deficit: Targeted at 4.3% of GDP for 2026-27, down from 4.4% in the previous year.
  • Debt-to-GDP: Estimated to moderate to 55.6%, with a long-term goal of 50% by 2030.
  • Total Expenditure: Projected at ₹53.5 lakh crore.
5. Strategic Initiatives
  • Manufacturing: Launch of India Semiconductor Mission 2.0 and the Biopharma SHAKTI scheme (₹10,000 crore) to boost high-value domestic production.
  • Energy: ₹20,000 crore allocated for Carbon Capture (CCUS) technologies over five years; customs duty exemptions for lithium-ion cell manufacturing and solar glass.
  • Tourism: Development of 15 archaeological sites into experiential destinations and the creation of eco-tourism trails.
AI responses may include mistakes. Information may vary depending on location or individual circumstances. Learn more
  • summary of union budget 2026-27 - PIB
    5 Feb 2026 — SUMMARY OF UNION BUDGET 2026-27. ... BASIC CUSTOMS DUTY EXEMPTION GIVEN TO CAPITAL GOODS USED FOR MANUFACTURING LITHIUM-ION CELLS ...
    PIB
  • Income Tax Act 2025: Key Provisions, Changes, and Budget ...
    2 Feb 2026 — It simplifies tax provisions, introduces a new filing system, revises TCS and STT rates, reforms MAT, aligns buyback taxation, eas...
    Physics Wallah
  • Union Budget 2026 Highlights: Key Tax, Sector & Policy Updates
    3 Feb 2026 — Union Budget Highlights 2026. ... Finance Minister Nirmala Sitharaman unveiled the Union Budget 2026 in the Lok Sabha. Her ninth c...
    DBS Bank | India
Show all
The Union Budget 2026–27, presented on 1 February 2026, is anchored in the vision of "Viksit Bharat 2047". It introduces a landmark New Income Tax Act, 2025 and prioritises infrastructure, manufacturing, and "Yuva Shakti" (Youth Power) while maintaining fiscal discipline.
1. Personal Finance and Taxation
The center-piece of the budget is the Income Tax Act, 2025, replacing the 1961 Act starting 1 April 2026 to simplify compliance and reduce litigation.
  • Income Tax Slabs: Rates remain unchanged, but the effective tax-free income remains ₹12 lakh under the New Tax Regime due to a ₹60,000 rebate.
  • Deductions: Salaried employees continue to benefit from a ₹75,000 standard deduction, making income up to ₹12.75 lakh tax-free.
  • Senior Citizens: The deduction limit has been doubled from ₹50,000 to ₹1 lakh.
  • Simplified Compliance: Revised returns can now be filed until 31 March (previously 31 December). A one-time 6-month amnesty scheme for disclosing small foreign assets (under ₹20 lakh) has been introduced for students and NRIs.
2. Financial Sector and Stock Market
  • Derivatives Tax (STT): Securities Transaction Tax on Futures increased to 0.05% (from 0.02%) and on Options to 0.15% to curb excessive speculation.
  • Share Buybacks: Profits from buybacks will now be taxed as Capital Gains for all shareholders.
  • Corporate Tax: The Minimum Alternate Tax (MAT) is becoming a final tax at a reduced rate of 14% (down from 15%).
3. Key Sector Allocations
The government has significantly increased public capital expenditure (Capex) to ₹12.2 lakh crore for FY27.
SectorAllocation (FY27)Key Highlights
Infrastructure₹12.2 lakh crore7 High-Speed Rail corridors (e.g., Mumbai-Pune, Delhi-Varanasi); 20 new National Waterways.
Defence₹7.85 lakh croreFocus on modernising forces with a 75% domestic procurement mandate.
Agriculture₹1.63 lakh croreLaunch of Bharat-VISTAAR (AI agri-tool) and development of 500 Amrit Sarovars.
Education₹1.39 lakh croreContent Creator Labs in 15,000 schools; 5 university townships near industrial corridors.
Healthcare₹1.06 lakh croreEstablishing 5 Regional Medical Hubs and training 1.5 lakh multiskilled caregivers.
4. Fiscal Indicators
  • Fiscal Deficit: Targeted at 4.3% of GDP for 2026-27, down from 4.4% in the previous year.
  • Debt-to-GDP: Estimated to moderate to 55.6%, with a long-term goal of 50% by 2030.
  • Total Expenditure: Projected at ₹53.5 lakh crore.
5. Strategic Initiatives
  • Manufacturing: Launch of India Semiconductor Mission 2.0 and the Biopharma SHAKTI scheme (₹10,000 crore) to boost high-value domestic production.
  • Energy: ₹20,000 crore allocated for Carbon Capture (CCUS) technologies over five years; customs duty exemptions for lithium-ion cell manufacturing and solar glass.
  • Tourism: Development of 15 archaeological sites into experiential destinations and the creation of eco-tourism trails.
AI responses may include mistakes. Information may vary depending on location or individual circumstances. Learn more
  • summary of union budget 2026-27 - PIB
    5 Feb 2026 — SUMMARY OF UNION BUDGET 2026-27. ... BASIC CUSTOMS DUTY EXEMPTION GIVEN TO CAPITAL GOODS USED FOR MANUFACTURING LITHIUM-ION CELLS ...
    PIB
  • Income Tax Act 2025: Key Provisions, Changes, and Budget ...
    2 Feb 2026 — It simplifies tax provisions, introduces a new filing system, revises TCS and STT rates, reforms MAT, aligns buyback taxation, eas...
    Physics Wallah
  • Union Budget 2026 Highlights: Key Tax, Sector & Policy Updates
    3 Feb 2026 — Union Budget Highlights 2026. ... Finance Minister Nirmala Sitharaman unveiled the Union Budget 2026 in the Lok Sabha. Her ninth c...
    DBS Bank | India
Show all
The Union Budget 2026–27, presented on 1 February 2026, is anchored in the vision of "Viksit Bharat 2047". It introduces a landmark New Income Tax Act, 2025 and prioritises infrastructure, manufacturing, and "Yuva Shakti" (Youth Power) while maintaining fiscal discipline.
1. Personal Finance and Taxation
The center-piece of the budget is the Income Tax Act, 2025, replacing the 1961 Act starting 1 April 2026 to simplify compliance and reduce litigation.
  • Income Tax Slabs: Rates remain unchanged, but the effective tax-free income remains ₹12 lakh under the New Tax Regime due to a ₹60,000 rebate.
  • Deductions: Salaried employees continue to benefit from a ₹75,000 standard deduction, making income up to ₹12.75 lakh tax-free.
  • Senior Citizens: The deduction limit has been doubled from ₹50,000 to ₹1 lakh.
  • Simplified Compliance: Revised returns can now be filed until 31 March (previously 31 December). A one-time 6-month amnesty scheme for disclosing small foreign assets (under ₹20 lakh) has been introduced for students and NRIs.
2. Financial Sector and Stock Market
  • Derivatives Tax (STT): Securities Transaction Tax on Futures increased to 0.05% (from 0.02%) and on Options to 0.15% to curb excessive speculation.
  • Share Buybacks: Profits from buybacks will now be taxed as Capital Gains for all shareholders.
  • Corporate Tax: The Minimum Alternate Tax (MAT) is becoming a final tax at a reduced rate of 14% (down from 15%).
3. Key Sector Allocations
The government has significantly increased public capital expenditure (Capex) to ₹12.2 lakh crore for FY27.
SectorAllocation (FY27)Key Highlights
Infrastructure₹12.2 lakh crore7 High-Speed Rail corridors (e.g., Mumbai-Pune, Delhi-Varanasi); 20 new National Waterways.
Defence₹7.85 lakh croreFocus on modernising forces with a 75% domestic procurement mandate.
Agriculture₹1.63 lakh croreLaunch of Bharat-VISTAAR (AI agri-tool) and development of 500 Amrit Sarovars.
Education₹1.39 lakh croreContent Creator Labs in 15,000 schools; 5 university townships near industrial corridors.
Healthcare₹1.06 lakh croreEstablishing 5 Regional Medical Hubs and training 1.5 lakh multiskilled caregivers.
4. Fiscal Indicators
  • Fiscal Deficit: Targeted at 4.3% of GDP for 2026-27, down from 4.4% in the previous year.
  • Debt-to-GDP: Estimated to moderate to 55.6%, with a long-term goal of 50% by 2030.
  • Total Expenditure: Projected at ₹53.5 lakh crore.
5. Strategic Initiatives
  • Manufacturing: Launch of India Semiconductor Mission 2.0 and the Biopharma SHAKTI scheme (₹10,000 crore) to boost high-value domestic production.
  • Energy: ₹20,000 crore allocated for Carbon Capture (CCUS) technologies over five years; customs duty exemptions for lithium-ion cell manufacturing and solar glass.
  • Tourism: Development of 15 archaeological sites into experiential destinations and the creation of eco-tourism trails.
AI responses may include mistakes. Information may vary depending on location or individual circumstances. Learn more
  • summary of union budget 2026-27 - PIB
    5 Feb 2026 — SUMMARY OF UNION BUDGET 2026-27. ... BASIC CUSTOMS DUTY EXEMPTION GIVEN TO CAPITAL GOODS USED FOR MANUFACTURING LITHIUM-ION CELLS ...
    PIB
  • Income Tax Act 2025: Key Provisions, Changes, and Budget ...
    2 Feb 2026 — It simplifies tax provisions, introduces a new filing system, revises TCS and STT rates, reforms MAT, aligns buyback taxation, eas...
    Physics Wallah
  • Union Budget 2026 Highlights: Key Tax, Sector & Policy Updates
    3 Feb 2026 — Union Budget Highlights 2026. ... Finance Minister Nirmala Sitharaman unveiled the Union Budget 2026 in the Lok Sabha. Her ninth c...
    DBS Bank | India
Show all

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