Indian Budget 2026 Presentation, Analysis, Calculators

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What is Budget?

A budget is a financial plan for a specified period say Year in general.

The Government of India i.e., Ministry of Finance after consultation with all the other ministries prepares the annual budget. The budget will be generally presented by the finance minister on the first day of February in Parliament.

The proposed budget will come into effect from April 1st of the respective year.

Economic Survey FY 2025-26 - Summary

Inflation is at the lowest since the beginning of the CPI series. Average Inflation is 1.7% for April-December 2025. Growth accelerates along with lower inflation
GDP growth outlook – 7.4% for FY 26
GVA growth outlook – 7.3% for FY 26
The global environment remains fragile with geopolitical tensions, trade fragmentation and financial vulnerabilities.
Protectionism and supply-chain realignments are reshaping global trade and investment flows.
Globalization is no longer going to provide the tailwind needed for export growth, and foreign investment

For more details, refer Highlights of Indian Economic Survey — FY 2025-26 Summary

Why is Budget 2026 unique?

1st Sunday Budget in India's history.
History of India's 2nd Sunday stock market open
The 9th consecutive budget by Hon'ble FM Nirmala Sitharaman
2nd time extreme external strain on Indian Budget for Growth during last few decades
Challenge to impress public when much broader incentives were announced for IT and GST in the last 2 budgets.

Why is Budget 2026 Challenging?

World of Economic Uncertainty with tariffs, fragmentation, supply chain issues — at the background
Preparing Indian economy for — the new world
Must balance between —
1. Establishing buffers for Indian economic stability from external factors.
2. Growth to drive GDP requires high CapEx, which is hard to allocate.
Taping growth drivers — Make in India, Defence — but both require high CapEx

Indian Budget 2026 | Pre-Budget Expectations

Expectations before Budget

List of expectations / recommendations for the Indian union budget 2026 were originally published on Jan 22nd 2026 @ Indian Budget 2026 | Pre-Budget Expectations

Key Takeaways & Analysis

Effort made for sustained economic growth and inclusion of low income and under-privileged.

Expanding the orange economy (creative/services economy) through innovation, culture, technology, urbanization, tourism, AI, and connectivity.

Growth Corridors: Seven high-speed rail corridors proposed for Mumbai–Pune, Pune–Hyderabad, Hyderabad–Chennai, Delhi–Varanasi, Varanasi–Siliguri

Rs. 10,000 Crore SME Growth Fund proposed to create MSME's future champions

Fine tuning IT compliance with new ITC Act 2025, along with de-criminalisation, foreign income disclosure, lowering TDS, TCS rates

Tax Holiday till 2047: Foreign companies providing cloud services globally using Indian data centres get full income tax exemption (condition: Indian customers served via an Indian reseller entity). Aims to boost data centre investments for AI/digital infrastructure.

Multiple initiatives around healthcare including Ayush Centres, additional jobs for health-care professionals due to major life-style diseases and cancer.

Interestingly, this Budget looks inward to identify opportunities in tourism, health care, and ecology.

Ayurveda & Health Infrastructure: Proposal to set up 3 new All India Institutes of Ayurveda (AIIA).

What are we missing?

Both agriculture and defence should have major announcements given the expectations, in addition to, mandatory prioritisation of locally made products in e-Commerce platforms.

Budget 2026 — Highlights

The highlights are mainly from the perspective of individual taxation point of view.

Taxes in General

The theme is to stabilise already announced tax & finance related reforms and optimisation.
6-month foreign assets disclosure scheme proposed with a retrospective date of 1st October 2024 (after 20 Lakhs in value).
Tax holiday for cloud services with India-based data centres (extended to 2047).
Updated returns (ITR-U) allowed with conditions to encourage voluntary compliance in exchange of a small fee.
Govt. made the decision to mitigate investor losses from F&O trading. This provision would make speculative F&O trading less attractive with the increased STT.
Derivative Type Current Rate New Rate
Futures 0.02% 🔺0.05%
Options Premium 0.10% 🔺0.15%
Options Exercise 0.13% 🔺0.15%

Derivative Type	Current Rate	New Rate
Futures	0.02%	🔺0.05%
Options Premium	0.10%	🔺0.15%
Options Exercise	0.13%	🔺0.15%

Income Tax

No major income tax slab revisions announced in the new or old regime. Slabs remain as per recent budgets (Budget 2025) (e.g., new regime: 0% up to ₹4 lakh, 5% ₹4-8 lakh, 10% ₹8-12 lakh, up to 30% above ₹24 lakh)

S.No	Income	Rate of Tax
1	Up to Rs 4 Lakhs	0%
2	From Rs 4,00,001 to Rs 8 Lakhs	5%
3	From Rs 8,00,001 to Rs 12 Lakhs	10%
4	From Rs 12,00,001 to Rs 16 Lakhs	15%
5	From Rs 16,00,001 to Rs 20 Lakhs	20%
6	From Rs 20,00,001 to Rs 24 Lakhs	25%
7	More than Rs 24 Lakhs	30%

Refer Latest EZTax Income Tax Calculator to know old vs new tax regime and tax for your income.

Now, Revised ITR can be filed even after December 31st of the AY but with a fee.
Taxable Income Revised ITR Late Fee
Up to Rs. 5 lakhs Rs. 1000
More than Rs. 5 lakhs Rs. 5000
Standard deduction unchanged (₹75,000 in new regime, ₹50,000 in old).
Effective zero-tax threshold stays ₹12.75 lakh for salaried in new regime (via rebate + deduction).

Taxable Income	Revised ITR Late Fee
Up to Rs. 5 lakhs	Rs. 1000
More than Rs. 5 lakhs	Rs. 5000

Several simplifications: New scheme for small taxpayers; several TCS/TDS changes (e.g., overseas tour TCS cut to 2%); simplified income tax rules to be notified soon.

Below are the new TCS rate changes

Nature of receipt	Current Rate	New Rate
Sale of alcoholic liquor for human consumption	1%	2%
Sale of tendu leaves	5%	2%
Sale of scrap	1%	2%
Sale of minerals, being coal or lignite or iron ore	1%	2%
Remittance under the Liberalised Remittance Scheme of an amount or aggregate of the amounts exceeding ten lakh rupees —	a) 5% for purposes of education or medical treatment	a) 2% for purposes of education or medical treatment
	b) 20% for purposes other than education or medical treatment	No Change
Sale of "overseas tour programme package" including expenses for travel or hotel stay or boarding or lodging or any such similar or related expenditure.	a) 5% of amount or aggregate of amounts up to ten lakh rupees	2%
	b) 20% of amount or aggregate of amounts exceeding ten lakh rupees	2%

No broad middle-class relief via slab hikes or major deduction boosts — focus stayed on continuity, implementation, and targeted tweaks.
Now taxpayers are allowed to file an updated return (ITR-U) in cases where there is a possibility of reduced loss amount compared to the loss amount claimed in the original return filed by the specified due date.
In addition, an amendment is proposed so as to allow filing of an updated return also in such cases where any proceedings for assessment, reassessment, recomputation, or revision of income are pending or have been completed for the tax year in question
In case of updated return is filed in pursuance of a notice issued u/s 280 of IT Act 2025, the additional income tax payable is increased to an additional 10%.
The changes to Updated return (ITR-U) would benefit many, particularly NRIs.
ITR-1 & ITR-2 deadline remains July 31; non-audit businesses (ITR-3 & ITR-4) & trusts up to August 31.
Staggered timelines for ITR filing proposed in some cases.
New Income Tax Act 2025 comes into effect from April 1, 2026 — simplified rules, redesigned forms for easier filing (to be notified soon).
TDS on NRI immovable property sale: Deducted by resident buyer (no TAN needed for buyer).
Higher thresholds for certain TDS/TCS sections (e.g., interest, dividends, winnings).
Motor accident claims tribunal interest: Exempt from income tax; no TDS.
Supply of Man Power services will be covered u/s 194C of Income Tax Act 1961 for TDS purposes. TDS needs to be deducted 1% /2 % depending in type of deductee
Simplified procedure for small taxpayers who wants to apply for lower or nil deduction of TDS
Penalty is replaced with the word "Fee" for belated filing of Tax Audit Reports. The late fee is proposed to be Rs 75000 for delay upto 1 month and Rs 1,50,000 later
Sale of Sovereign Gold bonds which are purchased in secondary market are taxable even the taxpayers held till maturity.

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Disclaimer: This article provides an overview and general guidance, not exhaustive for brevity. Please refer Income Tax Act, GST Act, Companies Act and other tax compliance acts, Rules, and Notifications for details.