Budget 2026 Highlights: Deadline extended for filing revised ITRs, govt clarifies STT hike – What changes?

India will focus on tier two and tier three cities as well as temple towns to build infrastructure and amenities, Finance Minister Nirmala Sitharaman said Sunday.

The announcement comes as the government’s budget seeks to boost manufacturing and infrastructure to support an economy grappling with steep US tariffs. India’s push for religious tourism in the past decade has seen number of visitors reach records and brought in money and investments in small towns.

India’s spiritual tourism market is expected to be worth $59 billion by 2028 and employ 100 million people, driven by factors like the growth of an affluent class and Prime Minister Narendra Modi’s push to turn India into a more overtly Hindu society.

India will step up outlay for electronics component manufacturing to 400 billion rupees ($4.3 billion) as the government seeks to boost goods exports from the nation.

Budget 2026 Speech LIVE: The FM announced that interest awarded by Motor Accident Claims Tribunals (MACTs) to natural persons would be fully exempt from income tax, with no tax deduction at source.
In many states, claimants wait five to ten years for final awards, particularly when cases move between tribunals and High Courts, reported The Week. As a result, interest is awarded to offset these delays, with tribunals typically granting 6–9% annually. However, insurers have often deducted tax on the interest component before releasing payments, citing ambiguity over its tax treatment.

Budget 2026 Speech LIVE: Atul Monga - CEO& Co-Founder, BASIC Home Loan said the Union Budget 2026 lays out key steps aimed at strengthening India’s housing ecosystem over the long term. He however also added that the “budget could have gone a step further by directly supporting homebuyers through higher home-loan interest benefits and targeted tax reliefs for first-time buyers.”

As announced by the Finance Minister Nirmala Sitharaman, the new Income tax act will come into effect from April 1, 2026.

The simplified Income Tax Rules and Forms will be notified in due course giving adequate time to taxpayers to acquaint themselves with its requirements, the government said in a release.

Presenting her ninth consecutive Budget on Sunday, FM Nirmala Sitharaman proposed to hike the Securities Transaction Tax (STT) on futures and options (F&O) trading.

Here's an overview of the proposed changes:

— Futures: STT hiked to 0.05% from 0.02%

— Options premium: An increase in STT to 0.15% from 0.1%

— Exercise of options: STT increased to 0.15% from 0.125%

“The Budget underscores the government’s long-term growth strategy by prioritising sectors such as data centres, clean technologies and semiconductors, which are poised to anchor the next investment cycle, including through primary markets,” said Ravi Dubey, Partner at Cyril Amarchand Mangaldas.

While Union Budget 2026 broadly met market expectations through constructive tax and regulatory measures, particularly on buybacks and higher foreign equity limits, the sharp increase in STT on F&O segment stands out as a key exception, he added.

Budget 2026 Speech LIVE: Regarding relief, the government has introduced measures in its budget proposals to lower prices for leather products, cancer medications, and seafood by extending policy support, enabling duty-free imports, and granting customs exemptions. Check the full list of what might get cheaper, and what might get expensive

Budget 2026 Speech LIVE: The ministry of finance has the highest allocation of ₹19.72 lakh crore.
– Ministry of Defence has been allocated ₹7.85 lakh crore
– For Ministry of Home Affairs, ₹2.55 lakh crore has been set aside
– Ministry of Rural Development has been allocated ₹1.97 lakh crore

Cigarette prices have increased by a minimum of ₹22 to 25 per pack of 10 sticks following the implementation of additional excise duty from Sunday.

From mental health infrastructure and regional medical hubs to biopharma manufacturing, caregiver training and cheaper cancer medicines, Delhi-based doctors and healthcare leaders on Sunday welcomed the measures listed in Union Budget 2026-27.

They said these will strengthen access, affordability and long-term capacity in the healthcare system.

The Union Budget 2026-27 on Sunday allocated over ₹2.55 lakh crore to the Ministry of Home Affairs, reflecting an increase of around 9.44 per cent from the budget estimates of over ₹2.33 lakh crore provided to it in 2025-26, news agency PTI reported.

Budget 2026 Speech LIVE: West Bengal chief minister Mamata Banerjee slammed the government over the Union Budget 2026–27, claiming it is a “directionless and visionless Humpty Dumpty Budget” that offers ‘nothing for the common man or for Bengal.’

Budget 2026 Speech LIVE: The Indian stock market witnessed a sudden, sharp fall of up to 3% in intraday trade on Sunday, February 1, after Finance Minister Nirmala Sitharaman proposed a steep increase in Securities Transaction Tax on derivatives.

Jimeet Modi, Founder & CEO of SAMCO Group, believes the increase in Securities Transaction Tax on futures and options has deeper implications than it appears on the surface. Click to know more

Budget 2026 Speech LIVE: Former Finance Minister P Chidambaram slammed the Union Budget 2026-27 claiming it is a “failed test of economic strategy, economic statesmanship.” He alleged that it “appears that the govt, FM discarded Eco Survey, fell back on their favourite pastime of throwing acronyms at people," reported PTI

Budget 2026 Speech LIVE: As per the Budget proposal, STT on futures will be hiked to 0.05% from 0.02% at present, and STT on options transactions will be raised to 0.15% from 0.1% earlier.

– What is STT: Securities Transaction Tax is a direct tax levied by the government on every purchase and sale of securities, such as equity shares, futures, and options, on recognised stock exchanges.

– Jimeet Modi, Founder and CEO of SAMCO Group, said the hike in securities transaction tax (STT) is not a minor technical adjustment but one that alters market microstructure.

– Hike impact on FPI: Analysts believe that the hike in STT for F&O transactions can negatively affect the flow of foreign portfolio investors (FPIs) who may tend to shift capital towards other emerging markets.

Budget 2026 Speech LIVE: Markets reacted sharply after FM Sitharaman Nirmala Sitharaman announced a sharp hike in STT by 150% on futures transactions and 50% on options transactions. Weighing on the move, Deepak Shenoy, Founder of Capitalmind, said the impact on retail traders is likely to be limited, with arbitrage funds emerging as the biggest affected segment.

Budget 2026 Speech LIVE: As the VB-G RAM G scheme is set to be rolled out, the Centre has allocated ₹95,692.31 crore for it, while an allocation of ₹30,000 crore has been made for the MGNREGA.

Budget 2026 Speech LIVE: FM Nirmala Sitharaman, in her Budget presentation said that to help MSMEs, the government will develop a cadre of "corporate mitras" in Tier-II and Tier-III cities.

– The cadre of "corporate mitras" will help Micro, Small and Medium Enterprises (MSMEs) to meet their compliance requirements at affordable costs.

– Government will also facilitate professional institutions such as ICAI, ICSI, ICMAI to design short-term modular courses and practical tools to develop the cadre.

Budget 2026 Speech LIVE: The FM allocated ₹2,77,830 crore to the Ministry of Railways for capital expenditure in the financial year 2026–27. The allocation includes the construction of new lines and the purchase of locomotives, wagons, and coaches, among other works.

Speaking about the allocation, Uttam Digga, CEO of Porter, said: “The record capex allocation, prioritizes roads, railways, multimodal connectivity, high-speed corridors, dedicated freight routes, and urban development,” which he said would significantly enhance 'logistics efficiency and reduce costs.'

Budget 2026 Speech LIVE: Jammu and Kashmir Minister Satish Sharma criticised the funds allocated to the Union Territory, saying that it was "peanuts" and insufficient to meet its developmental requirements. “This is peanuts. If the Centre truly wants to help the people of Jammu and Kashmir, it should grant a package of at least ₹50,000 crore,” news wire PTI quoted the minister as saying.

Budget 2026 Speech LIVE: The general government debt-to-GDP ratio was 85% in 2024, which included central government debt of 57%, as per a PTI report. The Centre has committed to keep fiscal deficit in each year (from FY27 to FY31) such that its debt is on a declining path to attain a debt-to-GDP level of about 50±1% by March 31, 2031, from the current level of 55.6%. Read here

Budget 2026 Speech LIVE: The Union Budget 2026 proposes several reforms that will benefit the common man, but has introduced some taxes that will affect future and options (F&O) traders:

– Farmer income: The FM announced a dedicated programme for Indian cashew and cocoa with the objective of making India self-reliant in raw cashew and coconut production and processing, while enhancing export competitiveness.
– ITR: Individual taxpayers will get more relaxations in terms of filing their income tax returns.

– Focus on students: The FM proposed to reduce the tax collection at source (TCS) rate to 2%for education purposes under Liberalised Remittance Scheme (LRS) as well as on sale of overseas tour program package.

– Banking reforms: Budget 2026 proposes to set up a high-level committee to review the banking sector

Budget 2026 Speech LIVE: The Union Budget 2026 presented on Sunday, had a key focus on export-oriented sectors such as marine products, leather and textiles. To support seafood exports, FM Sitharaman proposed raising the limit for duty-free imports of specified inputs used for processing seafood products from 1% to 3% of the previous year’s export turnover.

In the Union Budget 2026-27, the Centre proposed measures to reduce prices of leather products, cancer drugs and seafood by extending policy support, allowing duty-free imports and granting customs exemptions, with the objective of strengthening domestic industries while easing costs for patients and producers.

Meanwhile, trading activity and some corporate cash-distribution mechanisms are expected to turn more expensive due to proposed revisions to buyback taxation, the securities transaction tax (STT), and tax collected at source (TCS), indicating a stricter approach toward tax arbitrage and compliance.

Check full list here

A rough translation of Kamal Haasan's post on X read: "One of the three teachers who taught me Tamil was Kannadasan. He had already composed a song that day, guessing what the Indian budget might be like.

'Sing a song, brother, we'll forget our hunger for a bit.

Search and search in the capital of Bharath for a job, brother...

Sing the glory of Bharath, sing—why worry about rice, brother!'

I'm someone who draws inspiration from my teachers. Even before many festivals, seeing a budget would make me lament in Tamil verse, and that moment comes to mind right now.

'Thorns turn to cows and

yield milk,

Neem flowers fetch honey—

a money bee.

Poverty's rays are harvested

by desert streams on foot;

In the reaping of imagination,

dream rice sheaves.

Street-side landlords

pay taxes

in the reign of famine kings—

prosperity blooms everywhere.'

As far as India is concerned, this isn't just any budget; it feels like every budget somehow ties back to our taxes."

On Union Budget 2026, Union Minister Kiren Rijiju says, “For a developed India, the 'Reform Express' initiated by Prime Minister Modi has been reflected in a significant way in today's budget. I believe that today's budget is not just political rhetoric. Our Finance Minister has presented a strong case for the Reform Express for a developed India.”

“I am very happy, and the package that has been announced and established is simply outstanding. What has been done for the development of the eastern region, the announcements regarding express highways, the Buddhist circuit, and the huge announcements for minorities...,” Rijiju said.

He added, “I am very satisfied. As a minister, I am very happy. Even more than that, as an Indian citizen, I am very enthusiastic about this budget. Many announcements have been made for the Northeast. From infrastructure to connectivity, the Buddhist circuit, and in every respect, it has been done for the whole of India...”

Budget 2026 Speech LIVE: Presenting the Budget in Parliament, Sitharaman said the latest round of reforms would continue the process of pruning outdated exemptions, correcting inverted duty structures and improving certainty and efficiency in customs administration. Read here

Congress MP Shashi Tharoor has reacted to Union Budget 2026, suggesting that there was no mention of Kerala anywhere in the speech except for “coconuts and fishermen”. Demanding to know what's in the budget for the state, Shashi Tharoor said that any announcement on All India Institute of Ayurveda was awaited but there was none in Nirmala Sitharaman's Budget speech. Read full report here

Budget 2026 Speech LIVE: “As India advances towards a Viksit Bharat, the three kartavya articulated in the Union Budget provide a clear context for the Nation’s growth and aspirations, combining economic momentum with capacity building and inclusive progress," Parth Jindal, President, Cement Manufacturers’ Association (CMA).

Presenting the Budget, Sitharaman identified three central kartavyas, or duties, that would guide India’s economic strategy in the coming year. These duties, she said, are aimed at balancing growth with equity while responding to a challenging international environment.

FM Sitharaman did not announce any changes in the Income Tax slabs. Here's a glimpse at the slabs of the old and new tax regime

Budget 2026 Speech LIVE: AIADMK chief Palaniswami says Union Budget proposals like high speed rail corridors will bring big change, reported PTI

Budget 2026 Speech LIVE: The Union Budget is "tactical" but not a "breakthrough", Moody's Ratings on Sunday. Christian de Guzman, senior vice president at Moody's Ratings said 'planned fiscal consolidation, which will bring the budget gap to 4.3% from 4.4% in the current year, will not change India's credit profile', reported Reuters.

Anup Agarwal, Co-founder, Kiwi: “The ₹2,000 crore incentive allocation for UPI and RuPay in Budget 2026 reinforces the importance of a sustainable digital payments ecosystem. As UPI continues to scale across transactions and use cases, the role of NPCI in maintaining interoperability, reliability, and low-cost access remains central. Sustained incentives are critical to preserving this affordability while enabling responsible innovation across the ecosystem. At Kiwi, we see this as a strong foundation for layering transparent and responsible credit on top of trusted payment rails to improve access and affordability for everyday consumption.”

Budget 2026 Speech LIVE: “The Budget’s focus on data centres, cloud and AI infrastructure is equally significant. Long‑term policy certainty recognises that digital infrastructure is now strategic national infrastructure. As AI adoption accelerates across sectors, secure and resilient compute capacity will underpin public services, enterprise innovation, and long‑term competitiveness,” said Puneet Chandok, President, Microsoft India & South Asia.

BJP MP Hemang Joshi says, "This union budget is historic and futuristic. Under PM Modi's leadership, as the country prepares for 'Viksit Bharat', this budget will help advance that vision. Today, Nirmala Sitharaman has announced something for everyone, including the poor, the middle class, farmers, women, children, and youth. Whether it is the orange economy or digital public infrastructure, this budget presented how our country can stand strong on the international stage..."

Budget 2026 Speech LIVE: Following FM Sitharaman's announcement of 7 high-speed rail corridors, earlier in the day, RailTel Corporation's stock jumped 4.48% to ₹369.60 on the BSE. Meanwhile, Titagarh Rail Systems and PSU railway stock IRFC were up 3.20% at ₹124. IRCTC stock was higher by 2.07% and RITES by 2.99%.

Budget 2026 Speech LIVE: The Nifty index is once again under pressure, with the 50-stock index trading with a deficit of over 500 points.

Budget 2026 Speech LIVE: Rajiv Anand, MD & CEO of IndusInd Bank said “Union Budget 2026 maintains continuity by focusing on capital expenditure, with a moderate increase in budgetary spending, while keeping the tax code largely unchanged, thereby providing policy stability.”
In 2026-27, the government will spend ₹12.2 trillion as against the 2025-26 budget estimate of ₹11.2 trillion

Budget 2026 Speech LIVE: In bid to support micro, small and medium enterprises and help them to scale up, the government has proposed to enhance equity support to small and medium businesses. Liquidity support will also be enhanced through credit guarantees and other measures

Budget 2026 Speech LIVE: As per the Budget proposal, STT on futures will be hiked to 0.05% from 0.02% at present, and STT on options transactions will be raised to 0.15% from 0.01% earlier. The announcement shook Dalal Street, and Sensex crashed more than 2,000 points, while Nifty 50 slipped below the 24,600 level during intraday deals.

HS Kandhari, Executive Director, Harmony Infra Ventures, reacted to the Union Budget 2026, saying:

“The Budget sends a clear message that infrastructure remains central to India’s growth strategy. The increase in capital expenditure to ₹12.2 lakh crore provides much-needed continuity and confidence for developers and contractors planning long-term projects.

What stands out is the proposed Infrastructure Risk Guarantee Fund. Addressing risk at the construction and development stage is crucial, especially for large projects, and this move should improve lender confidence and private participation.

The focus on Tier 2 and Tier 3 cities and the push to strengthen construction equipment and capabilities also signal a more balanced and execution-focused approach. Overall, this Budget creates a more stable and enabling environment for infrastructure delivery across the country.”

Budget 2026 Speech LIVE: When questioned about the rationale behind the STT hike, the Revenue Secretary said that the hike is “intended to discourage speculative tendencies, handle systemic risk in derivatives market.”

Dr. Anish Shah, Group CEO & MD, Mahindra Group: “We applaud the Government of India’s Union Budget 2026 presented today by Finance Minister Nirmala Sitharaman. This Budget focuses on enhancing India’s competitiveness in the world, takes meaningful steps towards atmanirbharta and enables a wider participation in the benefits of economic growth.

The emphasis on frontier and strategic manufacturing sectors, including the launch of enhanced schemes such as Biopharma Shakti and the Semiconductor Mission (ISM 2.0), reflects a clear commitment to building global-scale manufacturing capabilities. Strengthening domestic value chains and reducing critical import dependencies will be key to India’s future industrial leadership.

We particularly welcome the significant increase in capital expenditure to ₹12.2 lakh crore for FY27, which underscores an unambiguous policy focus on infrastructure, regional development and job creation across the country. This will play a pivotal role in crowding in private investment, enhancing productivity and supporting the growth of tier-2 and tier-3 cities as emerging economic hubs.

The proposal to establish a dedicated ₹10,000 crore SME growth fund and incentives for industry clusters is a positive step toward enabling future job creation, supporting enterprise scaling, and boosting competitiveness of small and medium businesses.

Initiatives to promote critical minerals, rare earth corridors and enhanced electronics and capital goods manufacturing are forward-looking and essential for a resilient industrial ecosystem that can thrive amid global uncertainties.

And, most importantly, the emphasis on sabka saath, sabka vikaas is commendable. The actions to ensure every community has access to resources and opportunities will enable robust and sustainable economic growth.

Overall, Budget 2026 signals continuity in policy direction, a firm commitment to sustainable and inclusive growth, and efforts to unlock India’s economic potential at scale. We believe these measures can accelerate innovation, enhance value-added manufacturing and strengthen India’s standing in the world.”

Budgeted capex of ₹12.2 lakh crore in FY27 is 4.4 pc of GDP, highest-ever said FM Nirmala Sitharaman at post-budget conference.

FM Nirmala Sitharaman, during the post-Budget press conference, once again highlighted the proposals made with respect to rare earth corridors in 4 states including Kerala, Tamil Nadu

FM Nirmala Sitharaman is now addressing the press conference that is held after the Budget presentation.

Budget 2026 Speech LIVE: Customs duties have been lowered for goods in the following categories:
– Critical minerals

– Renewable energy

– Nuclear energy

– Electronics

– Civil Aviation

– Aircraft parts
– Drugs and medicines
– Personal import items

Budget 2026 Speech LIVE: “The Union Budget 2026 reinforces India’s steady, reform‑driven economic trajectory at a time of global fragmentation and supply‑chain realignment. By increasing public capital expenditure to ₹12.2 lakh crore and prioritising projects such as dedicated freight corridors, expanded waterways and logistics infrastructure, the Budget provides funded levers to accelerate execution across logistics and energy corridors. Taken together, it is a decisive push that aligns well with the sectors powering India’s next decade," said Srinivasan Vaidyanathan, Operating Partner, Essar

Budget 2026 Speech LIVE: Budget 2026 put technology at the forefront with ₹40,000 crore for electronics manufacturing, ISM 2.0 for semiconductors, data centre tax breaks, IT service reforms, and digital initiatives to boost agriculture, skills, and innovation across sectors. Read to know more