Finance Minister Nirmala Sitharaman presented the budget for the Tax year 2026-27 on Sunday, February 1, 2026, at 11:00 AM
FM PRESENTED UNION BUDGET ON THE SUNDAY 1ST, FEBRUARY 2026
This presentation is particularly notable as it marks a rare Sunday budget session, and it is the Minister’s ninth consecutive budget. As the budget will be presented on a Sunday morning,both the NSE (National Stock Exchange) and BSE (Bombay Stock Exchange) have issued official circulars confirming that the stock markets will be open for a full live trading session on Sunday, February 1, 2026.
Budget speech and key announcements,
KEY HIGHLIGHTS OF THE UNION BUDGET 2026
The budget is built on the vision of “Viksit Bharat” and is guided by three “Kartavyas” (Duties). Here are the key highlights:
1. Direct Tax & Income Tax
- New Income Tax Act 2025: The budget outlines the smooth transition to the new Act, which replaces the 1961 version starting April 1, 2026.
3. TCS (Tax Collected at Source) Reductions
One of the most significant “Ease of Living” measures in this budget is the slashing of TCS rates for essential overseas spending:
- Overseas Tour Packages: The TCS rate has been reduced from the previous high of 20% to a flat 2%, and notably, there is no minimum amount condition (removing the previous ₹7 lakh threshold).
- Education & Medical Remittances: For funds sent abroad under the Liberalised Remittance Scheme (LRS) specifically for education or medical purposes, the TCS rate is reduced from 5% to 2%.
- Specific Goods: TCS for sellers of alcoholic liquor, scrap, and mineral products has been rationalized to 2%.
TDS for Senior Citizens Benefit
While the standard deduction for the general salaried class stayed the same, the tax deduction limit for senior citizens (often related to interest income under Section 80TTB) has been doubled from ₹50,000 to ₹1 lakh
4. Other Key Tax Proposals
- Revised ITR Deadline: The deadline for filing revised returns has been extended from December 30 to March 31, allowing taxpayers more time to correct errors, albeit with a nominal fee.
- New Income Tax Act 2025: The FM confirmed that the new, simplified Income Tax Act will officially come into effect on April 1, 2026.
- Motor Accident Claims: Any interest awarded by the Motor Accident Claims Tribunal to an individual is now fully exempt from income tax, and all associated TDS has been removed.
- NRI Property Purchase: Resident buyers of NRI property can now deduct TDS without needing a Tax Deduction Account Number (TAN), simplifying the compliance process.
2. Infrastructure & Connectivity
- Capex Push: Capital expenditure for FY27 has been increased to ₹12.2 lakh crore (up from ₹11.2 lakh crore).
- High-Speed Rail: Seven new high-speed rail corridors have been announced to connect major growth hubs.
- Infrastructure Risk Guarantee Fund: A new fund to provide credit guarantees to lenders for private infrastructure projects.
3. Manufacturing & Industry
- Semiconductor Mission 2.0: Launched with an outlay of ₹40,000 crore to build a full-stack domestic chip ecosystem.
- Biopharma SHAKTI: A new scheme with ₹10,000 crore to boost the biopharma sector.
- Rare Earth Corridors: Dedicated corridors to be established in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu.
- SME & MSME: A new ₹10,000 crore SME Growth Fund was announced to support job-creating enterprises.
4. Technology & Education
- AI for Education: A new Centre of Excellence (CoE) in Artificial Intelligence for education with a ₹500 crore allocation.
- E2E Committee: A high-powered “Education to Employment and Enterprise” committee to align the service sector with the 2047 goals.
- Cloud Services Tax Holiday: A tax holiday until 2047 for foreign companies providing cloud services via Indian data centers.
5. Agriculture & Rural Development
- PM Dhan Dhaanya Krishi Yojna: Aimed at uplifting 1.7 crore farmers across 100 low-productivity districts.
- Lakhpati Didi: A shift in focus to help women move from credit-linked livelihoods to becoming full-scale enterprise owners.
6. Fiscal Indicators
- Fiscal Deficit: Target for FY27 is set at 4.3% of GDP (compared to 4.4% in the previous year).
- GDP Growth: The Economic Survey projects a real GDP growth of 6.8% – 7.2% for FY27.
The above information is gathered immediately after the speech. Subject to corrections