The Ministry of Finance (MoF), on February 1, 2026, presented the Union Budget 2026–27 in Parliament, describing it as a Yuva Shakti–driven Budget anchored in the Government’s “Sankalp” to uplift the poor, underprivileged and disadvantaged. Prepared for the first time in Kartavya Bhawan, the Budget is inspired by three Kartavya: accelerating and sustaining economic growth; fulfilling people’s aspirations by building capacity; and ensuring inclusive development in line with Sabka Saath, Sabka Vikas.
On the macro and reform front, the Budget announces that the new Income Tax Act, 2025 will come into effect from April 2026, with simplified rules and forms to follow, alongside measures to reduce multiplicity of proceedings and rationalise penalties and prosecution. Key tax proposals include a unified safe harbour regime for IT services with a 15.5% margin, an enhanced ₹2,000 crore threshold, tax holiday for foreign cloud service providers till 2047, MAT exemption for non-residents on presumptive taxation, higher STT on futures, and several customs duty exemptions, particularly for critical minerals, lithium-ion battery manufacturing, and select drugs.
Focusing on growth and inclusion, public capital expenditure has been increased to ₹12.2 lakh crore for FY 2026–27. Major initiatives include Biopharma SHAKTI with an outlay of ₹10,000 crore, a ₹10,000 crore SME Growth Fund, development of seven high-speed rail corridors, expansion of education and skilling infrastructure, promotion of sports under the Khelo India Mission, deployment of AI in agriculture through Bharat-Vistaar, and reforms in customs warehousing and cargo clearance through a single digital window, reinforcing India’s path towards Viksit Bharat.
[Notification No. 2221458]
