Union Budget 2026 Expectations Live Updates: Tax Cuts, Customs Overhaul & Export Growth In Focus: Will It Satisfy Taxpayers?

Union Budget 2026 Expectations Live Updates: Tax Cuts, Customs Overhaul & Export Growth In Focus: Will It Satisfy Taxpayers?

“As Finance Minister Nirmala Sitharaman prepares to present the Union Budget, the focus will be on building on recent positive momentum to keep insurance products affordable, simple and widely accessible. There is also merit in reviewing certain healthcare-related tax provisions that were framed years ago and may no longer reflect today's operating realities, particularly in urban healthcare.

From an industry perspective, stronger alignment between tax policy, insurance adoption and broader economic priorities will be important. A predictable and simplified framework that supports long-term savings, health protection and financial resilience can benefit both enterprises and individuals. Hospital room rents illustrate this well. Even standard rooms today often exceed older benchmarks and attract GST, leading to higher out-of-pocket costs for patients. Updating such thresholds in line with current healthcare costs can help ease financial strain on households. Alongside this, greater clarity and consistency in the tax treatment of group medical cover can enable MSMEs to extend health security to their workforce, strengthen formal employment and support business continuity across sectors.

At the same time, retirement preparedness is emerging as a critical pillar of India's financial ecosystem. With over 14 crore Indians already above the age of 60 and this population expected to nearly double by 2047, the need for sustained, long-term pension savings is becoming increasingly urgent. Strengthening participation in the National Pension System by extending tax benefits under the new tax regime to both salaried and self-employed individuals, and by delinking employer participation from the employee's tax benefit to allow voluntary contributions up to the defined threshold, can encourage disciplined retirement savings. Making pension planning more rewarding, flexible and predictable will be essential to ensuring financial independence in later years and aligning India's pension framework with global best practices.”

Sarbvir Singh, Joint Group CEO, PB Fintech

Dr. B.V.R. Mohan Reddy, Founder Chairman, Cyient : “As India prepares for Budget 2026, there is strong confidence that the government will further accelerate productivity-led growth by building on its consistent efforts to enhance ease of doing business and policy predictability. Continued steps to simplify regulations, reduce compliance friction and minimise litigation will reinforce India's attractiveness as a global investment destination. In line with NASSCOM's recommendations, sustained and enhanced public investment in education, skilling, applied research and emerging technologies such as AI, digital engineering and deep tech will strengthen India's innovation ecosystem. A robust education–research–entrepreneurship continuum will play a key role in advancing global competitiveness and long-term economic resilience.”

Eshwar Surana, Managing Director, Raj Diamonds, said: The gem and jewellery industry is expecting focused, growth-oriented policy support that can sustain consumer confidence, strengthen employment, and accelerate consumption. At this stage, the priority should be business-friendly reforms that enhance transparency and help bridge the long-standing gap between organised and unorganised players. A reduction in GST on gold jewellery from the current 3% to around 1.5% would go a long way in easing financial pressure on consumers and stimulating demand, especially in a challenging global trade environment. Similarly, a rationalisation of import duties on diamonds and coloured gemstones would help reduce pricing pressure and support demand momentum, particularly ahead of the wedding season. We also expect the Union Budget to focus on increasing the disposable income of India's growing middle class through favourable fiscal measures and a stable, predictable tax regime. This will be critical for demand generation and sustained consumption. Despite global headwinds, India's economy continues to grow at a healthy pace, and we remain optimistic about the long-term prospects of the diamond and jewellery industry. With the right policy support, the sector will continue to be a significant contributor to employment, exports, and India's GDP.

Anand Kumar Bajaj, Founder, MD & CEO, PayNearby, said: “As India moves towards becoming a developed economy, the next phase of growth will depend on how effectively we enable access to essential financial and digital services across semi-urban and rural Bharat. With rising aspirations, increasing smartphone usage and stronger digital public infrastructure, citizens are ready to participate more actively in the formal economy.

Waiver of GST on financial services delivered through BC outlets, which play a critical role in enabling access across rural and semi-urban Bharat. This will reduce operating costs for last-mile partners, improve service viability, and encourage more neighbourhood entrepreneurs to participate in the formal financial ecosystem. Rationalisation of TDS provisions and tax benefits on operational expenditure for fintechs, which can improve cash flows and support continued investments in secure technology, agent training and customer awareness. In addition, a dedicated 5% GST slab for startups focused on last-mile service delivery will further strengthen the sustainability of local service networks and help expand access to essential financial and digital services for citizens. Focused policy support for women-led entrepreneurs, which will be key to helping them scale, strengthen household incomes and expand access to essential services within their communities”.

“The Union Budget 2026 is a critical opportunity to move India decisively into the next phase of its clean energy transition, where energy storage becomes as central as generation. To unlock this inflection point, policy must strengthen three core pillars. First, deeper support for vertically integrated manufacturing- spanning solar, batteries, and energy management systems- to build resilient domestic supply chains and reduce import dependence. Second, an expanded and more flexible viability framework that enables large-scale deployment of storage, particularly when integrated with solar and hybrid projects. And third, a sharper focus on domestic value addition that catalyses skilled employment and long-term manufacturing competitiveness. When solar and storage scale together, India's clean energy journey moves from capacity creation to system leadership. With the right policy push, India can not only achieve its 2030 targets with confidence, but also emerge as a global hub for clean energy manufacturing and technology.” – Mr. Sunil Rathi, Executive Director, Waaree Energies Limited

As faceless assessments become the norm, experts flag the need for flexibility in exceptional cases.

Rahul Jain, Partner at Khaitan & Co, says, “While this does aid the overall process, an option to enable an in-person hearing to explain complex facts and address the technical issues may be provided to the taxpayers, with appropriate checks and balances.”

He notes that although video-conferencing exists, certain matters still require physical interaction for effective resolution.

As healthcare costs and retirement needs evolve, industry leaders are calling for tax rules to keep pace.

Sarbvir Singh, Joint Group CEO, PB Fintech, says, “Hospital room rents illustrate this well. Even standard rooms today often exceed older benchmarks and attract GST, leading to higher out-of-pocket costs for patients. Updating such thresholds in line with current healthcare costs can help ease financial strain on households.”

He also stresses the need to strengthen long-term financial resilience through predictable tax policies and wider participation in pension savings.

Experts say better use of existing pension incentives can significantly expand retirement coverage.

Goel points out, “Another opportunity area lies in improving the utilisation of an already available tax incentive for individuals employed in the corporate sector by delinking employer participation from the employee's tax benefit.”

He adds, “This would allow employees to receive tax benefits on voluntary contributions to NPS up to the currently defined threshold.” Such flexibility, he notes, can help bring more workers into the pension net and support continuity of savings across careers.

As Budget 2026 approaches, expectations are rising around policies that strengthen India's digital financial backbone and regulatory certainty.

Dr. Vikas Garg, Chairman, Ebix Group, highlights why stability and trust matter for high-volume digital businesses, saying, “The country needs long-lasting frameworks that give institutions the confidence to operate at scale and give consumers the assurance that every transaction is secure, compliant, and seamless.”

He adds that “a simpler KYC framework, clearer risk rules, and stronger incentives for secure digital flows would make a meaningful difference on the ground,” while stressing the importance of continued investment in digital public infrastructure to support durable, trust-led growth.

Garima Singh, Co-Founder of the Global Tokenization Forum and a Blockchain & AI Strategist: “India has never been a follower in technology. We leapfrogged to mobile-first, pioneered UPI, revolutionized digital payments. Now we risk sitting out the blockchain revolution we're fully capable of leading. Budget 2026's VDA tax reforms will determine whether India's Web3 future is built in India or despite our absence. The world won't wait and neither will our talent. The cryptocurrency and blockchain industry urges the Finance Ministry to introduce four critical reforms: reduce VDA tax from the current 30% flat rate to a tiered capital gains structure aligned with equity markets, 15% for short-term holdings and 10% for long-term investments; cut the transaction tax (TDS) from 1% to 0.1% to restore market liquidity and end the working capital crisis faced by traders; allow investors to set off losses against capital gains, a basic principle of fair taxation; and create a regulatory sandbox for blockchain startups where Indian entrepreneurs can innovate with regulatory clarity. These measures aren't about lenient oversight, they're about smart regulation that attracts global capital and talent to India rather than driving them to Dubai, Singapore, and Hong Kong”.

New Income Tax Rules 2025: India is set to overhaul the direct taxation system with the introduction of New Income Tax Rules this year, aimed at simplifying the law, reducing disputes, and making compliance easier through clearer language and technology-driven processes.

“The Government has been very supportive of the Renewable sector. While existing policies have successfully driven capacity expansion and catalysed domestic manufacturing, sustained investor confidence is built on policy stability and assured payment mechanisms. Hence, the Government should continue with the schemes that drive investments in manufacturing and provide payments security for the RE generators. Also, as the generation continues to scale, greater emphasis must be placed on sprucing up grid infrastructure and enabling long-duration storage solutions. Without these systemic enablers, the ability to absorb higher volumes of renewable energy could become a limiting factor.” – Mr. Kushagra Nandan, Co-Founder, LNK Energy.

Nikhil Aggarwal, Founder & Group CEO, Grip Invest, said: “The upcoming Budget can accelerate bond adoption by reducing friction and improving liquidity. Key steps include incentivising secondary-market trading, strengthening repo and market-making frameworks, and expanding credit enhancement mechanisms so issuances are not restricted only to top-rated entities. These measures would make bonds more competitive with equities as scalable, long-term investment options. A recent report by Niti Aayog on Deepening the Bond Market clearly identifies tax asymmetries such as slab-rate taxation of interest, TDS inefficiencies, and unfavourable capital-gains treatment as major deterrents to long-term bond investing. Rationalising these, especially for long-tenor listed bonds and retail-focused fixed-income products, would materially improve household participation.

Digital platforms are also essential to expanding retail participation, which remains below 2%. The Budget can support this by backing standardised disclosures, real-time bond data infrastructure, and strong suitability and risk-labelling norms, allowing platforms to democratise access while preserving investor protection by design. A further reduction in the minimum investment amount for highly rated issuers will also help broaden the investor base. Over the long term, India needs a sustained shift toward market-based financing through coordinated regulation, deeper secondary markets, broader issuer participation beyond AAA credits, and stronger recovery and enforcement mechanisms. This will gradually reduce over-reliance on bank credit and enable the bond market to fund infrastructure, MSMEs, and long-duration assets at scale.”

Shashank Agarwal, Joint Managing Director, Salasar Techno Engineering Ltd, said: “India's infrastructure build-out is central to unlocking productivity, improving logistics efficiency, and converting our population dividend into an economic advantage. As we look to the upcoming Union Budget, Salasar Techno Engineering Ltd. expects a continued and sustained thrust on public capex with multi-year predictability, because long-cycle infrastructure requires stable pipelines not one-time spikes in spending.

While investments in railways, airports and ports are important, the next phase must prioritise roads and urban mobility at scale: decongesting cities, improving traffic flow, building stronger inter-city corridors, and ensuring last-mile connectivity. Faster and safer movement of people and goods is the most direct lever to raise national efficiency and reduce logistics costs.

We also expect ongoing support for power infrastructure, particularly transmission and distribution upgrades, grid resilience, and renewable integration—along with measures that improve execution: streamlined approvals, quicker dispute resolution, standardised contract frameworks, and timely release of payments to keep the sector's working capital healthy.

On telecom and digital infrastructure, recent clarity in public tenders has been helpful. However, we believe the sector now needs clearer visibility on private-side expansion and enabling policies that strengthen competitiveness. A healthier competitive landscape across telecom services as well as tower infrastructure—will support innovation, resilience and affordability for consumers. Simplifying Right-of-Way, accelerating fibre densification, and ensuring faster rollouts in both urban and rural India should remain key priorities.

Overall, we look to the Budget for a practical, execution-focused roadmap that keeps India's infrastructure growth on a high trajectory for several years to come.”

The budget session of Parliament begins today, 28 January. The session starts with an address by President Droupadi Murmu to the joint sitting of both Houses.

The Economic Survey of India will be presented on January 29. Finance Minister Nirmala Sitharaman will present Union Budget on 1 February, which is a Sunday.

The Halwa ceremony, marking the final stage of the Budget preparation process for Union Budget 2026-27, was held on Tuesday in the Budget Press at North Block, in the presence of Union Minister for Finance and Corporate Affairs Nirmala Sitharaman.

Parliament Budget Session 2026 Live Updates: The upcoming Budget will be Nirmala Sitharaman's ninth consecutive presentation, a record under Prime Minister Narendra Modi, placing her just one short of Morarji Desai's all-time tally.

Source: News18
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