Union Budget 2026 | From income tax to orange economy – Here’s your quick guide to Nirmala Sitharaman’s Budget for Viksit Bharat

Budget 2026 | Union Finance Minister Nirmala Sitharaman’s presented her ninth consecutive Budget in the Parliament on February 1 2026. In her opening remarks, the FM said that India today faces an external environment where trade and multilaterism is imperative.

India will continue to take steps towards Viksit Bharat. Our government has chosen reforms over rhetoric, FM added.

Here are the major highlights from Finance Minister Nirmala Sitharaman’s Union Budget speech:

• Finance Minister lays 16th Finance Commission report for tax revenue devolution between Centre, states for 2026-2031 in Lok Sabha.
• Our government has chosen reforms over rhetoric: FM Sitharaman.
• India will continue to take steps towards Viksit Bharat: FM Sitharaman.
• Today we face an external environment where trade and multilaterism is imperative, says Finance Minister Sitharaman.
• We will ensure that dividends of growth reach every farmer, scheduled caste, scheduled tribe, and youth: Sitharaman.
• Government's Sankalp is to focus on poor, underprivileged and disadvantaged: FM Sitharaman.
• Our Kartavay is to accelerate and sustain economic growth, fulfil aspirations of people: FM Sitharaman.
• Our Kartavya is to ensure every family, community, and sector has access to resources, amenities and opportunities: Sitharaman.
• Robust financial sector is central to mobilising savings, allocating capital and managing better governance: FM.
• Various reforms rolled out since August 15, including GST, labour codes, and quality control order; reform express on its way: Sitharaman.
• 'Sabka Sath, Sabka Vikas' third Kartavya of government, says FM Sitharaman.
• FM proposes interventions in 6 sectors, including manufacturing, strategic and frontier sectors, healthcare and advanced technology.
• Semiconductor mission 2.0 will focus on producing equipment and materials designed for full-stack Indian IP: Sitharaman.
• Budget 2026-27 proposes Rs 10,000 crore investment in biopharma over next 5 years: FM.
• FM proposes to support mineral rich states of Odisha, Kerala, Andhra Pradesh and Tamil Nadu to establish critical mineral facilities.
• FM proposes to increase outlay on electronic manufacturing to Rs 40,000 cr in FY27 budget.
• High-tech tool rooms to be established at two locations to give push to capital goods manufacturing: FM.
• FM proposes setting up of 3 dedicated chemical parks to enhance domestic production, reduce import dependency.
• A scheme for enhancement for construction and infrastructure equipments will be introduced to strengthen domestic manufacturing: FM.
• FM proposes scheme for container manufacturing to create globally competitive ecosystem.
• FM proposes setting up mega textile parks with focus on value addition to technical textiles.
• India has potential to emerge as a global hub for high-quality affordable sports goods: FM.
• Propose Mahatma Gandhi Gram Swaraj initiative to strengthen Khadi handloom: Sitharaman in Budget FY'27.
• FM proposes scheme to revive 200 legacy industrial clusters in FY27 budget.
• Budget proposes to set up Rs 10,000 crore to create champion SMEs: Sitharaman.
• Budget 2026-27 proposes integrated textile programme with five sub-parts.
• FM Sitharaman proposes to top up Self Reliance India Fund with Rs 4,000 cr in FY27 to support MSMEs.
• FM proposes to make TReDS as transaction platforms for all purchases from MSMEs by central public sector enterprises.
• Budget 2026-27 proposes Natural Fibre Scheme, Textile Expansion and Employment scheme, National Handloom and Handicraft programe.
• We will continue to develop infrastructure in Tier 2, Tier 3 cities: Sitharaman.
• Govt proposes to support professional institutions like ICAI, ICSI to design short term modular courses.
• Propose to set up infrastructure risk guarantee fund for infra sector: Sitharaman.
• Finance Minister proposes to raise capex target to Rs 12.2 lakh crore for FY27 from Rs 11.2 lakh crore earmarked for current fiscal.
• FM proposes setting up of Infrastructure Risk Fund to strengthen private developers risk management.
• New dedicated freight corridor from Dankuni in East to Surat in West to promote environmentally sustainable movement of cargo: Sitharaman.
• A ship repair ecosystem catering to inland waterways will be set up at Varanasi and Patna: FM.
• FM proposes incentives for indigenous manufacturing of sea planes.
• Outlay of Rs 20,000 cr proposed for launch of carbon capture and utilisation scheme across sectors like steel and cement: FM.
• Propose setting up high level committee on 'Banking for Viksit Bharat': Sitharaman.
• FM proposes developing 7 high speed corridors between cities as growth connectors.
• Budget proposes to review foreign exchange management non-debt instruments rules: Sitharaman.
• FM proposes incentive of Rs 100 crore for single bond issuance by municipal corporation of more than Rs 1,000 crore.
• Finance Minister proposes to restructure REC, PFC as part of public sector financial institution strengthening.
• Today, Indian banking sector is characterised by strong balance sheet, historic high profitability: FM Sitharaman.
• Close to 25 cr people have come out of multi-dimensional poverty: FM Sitharaman.
• FM proposes to market making framework with suitable access to funds and derivatives on corporate bond indices.
• Person of Indian Origin (PIO) permitted to invest in equity instruments, listed indian companies through Portfolio Investment Scheme: FM.
• Existing institutions for allied health professionals to be upgraded: Sitharaman.
• FM proposes raising investment limit for individual PIO from 5 pc to 10 pc.
• Govt will continue to focus on developing infrastructure in cities with over 5 lakh population: FM Sitharaman.
• Govt to support states in setting up five hubs for medical tourism: Sitharaman.
• Govt proposes scheme to strengthen domestic manufacturing of high-value, technology-advanced capital goods and infrastructure equipment.
• Budget proposes to support of Indian Institute of Creative Technologies Mumbai for setting up content labs in 15,000 secondary schools.
• Budget proposes Biopharma SHAKTI with an outlay of Rs 10,000 crore over next 5 years: FM Sitharaman.
• FM proposes setting up 3 new All India Institute of Ayurveda.
• FM proposes loan-linked capital subsidy support scheme for veterinary collages, hospitals, diagnostics laboratories.
• Centre to support 5 university townships in vicinity of major industrial logistics centres: Sitharaman.
• FM proposes upgradation of Ayush pharmacies and drug testing labs, WHO Traditional Medicine Centre at Jamanagar.
• Govt to set up one girls' hostel in every district of country: FM Sitharaman.
• Budget proposes to upgrade WHO Global Traditional Medicine Centre at Jamnagar, Gujarat.
• Govt to launch pilot scheme to upgrade skills of 10,000 guides at 20 iconic tourist sites: FM Sitharaman.
• India has potential to offer world class experience in mountaineering, says FM.
• We will develop ecologically sustainable trails in Himachal Pradesh, Utttarakhand and Jammu and Kashmir: Sitharaman.
• Khelo India Mission to transform sports sector over next decade: Sitharaman.
• FM proposes to develop 15 archeological sites, including Lothal and Hastinapur.
• FM proposes 'Education to Employment and Enterprise' Standing Committee to recommend measures focusing on services sector.
• Govt will develop cadre of 'Corporate Mitras' in Tier-II, Tier III towns to help MSMEs: FM Sitharaman.
• Govt to support high-value crops such as coconut, sandalwood, walnuts: FM.
• Govt proposes coconut promotion scheme to increase production, productivity.
• Centre to partner with states to restore glory of sandal wood ecosystem: Sitharaman.
• Govt will create a network of over 1,000 accredited Indian Clinical Trial sites: FM.
• Govt proposes credit link subsidy programme, encourage livestock farmer producer organisations to promote employment opportunities: FM.
• FM proposes to launch Bharat Vistar, a multilingual AI tool to integrate agri stack.
• FM proposes setting up of 'She Marts' as community-owned retail outlets.
• FM proposes to support Artificial Limbs Manufacturing Corporation of India to scale up production of assisted devises for divyangjan.
• FM allocates Rs 5,000 crore for CITY Economic Regions (CERs) over 5 years.
• Govt has accepted the recommendations of 16th Finance Commission, retaining 41 pc tax devolution formula: Sitharaman.
• Govt to launch scheme for development of Buddhist circuit in North East region to preserve temple, monastries: FM Sitharaman.
• Govt proposes to lower debt-to-GDP ratio to 55.6 pc per cent in FY27, from 56.1 pc in current fiscal: Sitharaman.
• Fiscal deficit pegged at 4.3 pc of GDP in FY'27, lower than 4.4 pc in FY'26: Sitharaman.
• Govt provides Rs 1.4 lakh crore as tax devolution to states in FY27: FM.
• Net tax receipts estimated at Rs 28.7 lakh crore, Budget size at Rs 53.5 lakh crore. Sitharaman.
• Income Tax Act, 2025, to be implemented from April 1; rules and tax returns forms to be notified shortly: Sitharaman.
• Govt to borrow Rs 11.7 lakh crore in FY27 from dated securities to fund its fiscal deficit.
• FM Proposes rule-based automated process for small taxpayers in FY27 Budget: Sitharaman.
• FM proposes to increase time limit for filing revised I-T return from December 31 to March 31, on payment of nominal fee.
• Govt proposes to exempt award given by Motor Accident Claims Tribunal from income tax, says FM.
• Tax Collected at Source (TCS) rate on sale of overseas tour packages cut to 2 pc from 5 pc and 20 pc earlier: FM.
• Govt proposes reduction in TCS rate for pursuing education and medical education under liberalised remittance scheme from 5 pc to 2 pc.
• FM proposes a six-month foreign asset disclosure scheme for small taxpayers like students, tech professionals and relocated NRIs.
• No interest liability on taxpayer on penalty amount for period of appeal before 1st appellate authority, irrespective of outcome: FM.
• FM Sitharaman: 50 per cent capacity will be increased in district hospitals by establishing emergency and trauma care centres.
• FM proposes exemptions of 3 years for dividend income received by notified cooperatives on investments made up to January 31, 2026:
• Govt to develop ecologically sustainable mountain trails in HP, Uttarakhand, J&K, Araku Valley of Eastern Ghats and Western Ghats, says FM.
• FM says NIMHANS-2 (National Institute of Mental Health and Neurosciences) will be set up.
• Govt extends deduction for cooperative members who supply cotton seeds and cattle feed.
• In Odisha, Karnataka, and Kerala, key turtle nesting sites along with turtle trails will be developed: FM Sitharaman.
• Govt will set up National Institute of Hospitality by upgrading existing National Council for Hotel Management and catering Technology: FM.
• Budget proposes tax holiday till 2047 to foreign companies that provide cloud services to customers globally by using data centres in India.
• Govt allows inter-cooperative societies dividend income as deduction under new tax regime: FM Sitharaman.
• Threshold for availing safe harbour for IT services is being enhanced from Rs 300 crore to Rs 2,000 crore: FM.
• Budget proposes to rationalise definition of accountants for safe harbour rules to promote home-grown accounting firms: Sitharaman.
• FM proposes to exempt Minimum Alternate Tax for non-residents who pay tax on presumptive basis.
• Tax Collected at Source rate on liquor, scrap and mineral rationalised to 2 per cent: Sitharaman.
• Govt to tax buyback proceeds for all types of shareholders as capital gains: FM Sitharaman.
• Govt proposes joint panel of Corporate Affairs Ministry and CBDT for incorporation of income computation and disclosure standards.
• National Destination Digital Knowledge Grid will be established to digitally document all places of significance: FM.
• MAT to be made final tax; rate reduced to 14 pc, from current 15 pc: Sitharaman.
• Budget proposes to raise Securities Transaction Tax to 0.05 pc on commodity futures from 0.02 pc: FM Sitharaman.
• Govt will develop an integrated East Coast Industrial Corridor with well-connected node at Durgapur: FM.
• Budget proposes to remove exemptions on customs duties on items manufactured in India or have negligible import.
• FM extends exemption on capital goods used for manufacturing lithium ion cells for battery storage.
• Govt will create five tourism destinations in 5 Purvodaya states and will make provisions for 4,000 e-buses: FM.
• Budget proposes to exclude entire value of biogas while calculating excise duty payable on blended CNG: FM Sitharaman.
• Govt proposes to extend time period of exports of final products from 6-month to 1-year for exporters of leather, textile garments.
• Govt will develop 15 archaeological sites, including Lothal, Dholavira, Rakhigarhi, Sarnath and Hastinapur: FM.
• FM proposes duty free imports of certain specified inputs for promoting export of leather.
• Budget exempts parts used to manufacture microwave ovens from basic customs duty: FM Sitharaman.
• Govt to support Artificial Limbs Manufacturing Corporation of India to scale up production of assistive devices: FM Sitharaman.
• Validity for advance period, binding on Customs, extended from 3 years to 5 years: Sitharaman.
• Approval required for cargo clearances will be seamlessly processed through a single window by year end: Sitharaman.
• Govt to exempt duty on fish catch by Indian fishing vessels in exclusive economic zones or high seas.
• Govt to revise provisions related to baggage clearance during international travel to address genuine concerns of passengers.
• Customs duty exemptions removed on coffee roasting/brewing/vending machines, CD-ROMs containing books or newspaper from Feb 2: FM Sitharaman.
• Tariff rate on certain items is being modified with effect from Feb 2 and certain others from Apr 1 as part of rate rationalisation: FM.
• Govt removes customs duty exemption on naphtha for use in fertilisers and metal parts used in manufacture of electrical insulators.
• Budget proposes new tariff lines to help in better identification of coated pipes for exports: FM Sitharaman.
• Customs duty on TV equipment, cameras and other instruments imported by a foreign film unit or TV team for shooting films removed from April 1.
• Customs duty exemption on video games manufacturing parts removed from April 1: Sitharaman.