Budget 2026 Highlights: Key Expectations, Live Updates & Important Points

The Union Budget 2026 is being presented on 1 February 2026 and is expected to focus on economic stability, infrastructure growth, MSME development, defence, healthcare, and manufacturing.

Citizens, taxpayers, and businesses are closely tracking budget 2026 live updates, income tax announcements, and policy reforms introduced by the Finance Minister of India.

Download Full Union Budget 2026 PDF

Budget 2026 – Key Expectations Overview

• Major changes in income tax slabs under the new regime are unlikely
• The old tax regime is expected to continue
• Strong focus on infrastructure, defence, manufacturing, and MSMEs

Income Tax Slabs – Budget 2026 Expectations

Large-scale relaxations in income tax slabs are not expected in Budget 2026. The government already introduced significant slab changes under the new tax regime in the previous budget.

Experts believe the focus may remain on simplifying compliance rather than offering fresh slab restructuring.

Will the Old Tax Regime Be Abolished?

While the new tax regime continues to gain popularity, the old tax regime is expected to remain for the next few years.

Many taxpayers still find the old regime beneficial due to deductions under various sections, making its immediate removal unlikely.

Home Loan Tax Relief Expectations

Currently, home loan interest deduction for self-occupied property is not available under the new tax regime.

In Budget 2026, the government may consider extending this benefit to the new regime and revising the existing ceiling limit of ₹2 lakh.

Administrative Reforms in Income Tax

The government has made progress in digitisation, faster refunds, and simplified ITR filing. However, litigation resolution and assessment timelines remain a concern.

Budget 2026 may introduce reforms to reduce disputes and speed up tax-related proceedings.

Addressing Grey Areas in Tax Laws

Despite simplification efforts, ambiguity still exists in areas such as mergers, acquisitions, ESOP taxation, and complex transactions.

Tax professionals expect Budget 2026 to address these grey areas and provide clarity.

Manufacturing & MSME Development

MSMEs are expected to receive strong policy support in Budget 2026. Key focus areas may include:

• Improved access to credit
• Support to handle global economic uncertainty
• Last-mile support for rural and semi-urban markets

Real Estate Sector Expectations

Increasing the affordable housing threshold could boost residential demand, especially in semi-urban and rural regions.

With the government targeting housing for all, real estate reforms are expected to support long-term growth.

Healthcare Sector Focus

Rising medical inflation has increased the burden on senior citizens and patients with chronic illnesses.

Budget 2026 is expected to focus on improving affordability, access, and healthcare infrastructure.

Defence Sector Expectations

Given recent geopolitical challenges, defence spending is expected to increase. Likely focus areas include:

• Indigenous defence manufacturing
• Capital investment and tax incentives
• Defence research in AI and robotics

Union Budget 2026 Live Updates

🔴 LIVE UPDATE SECTION

• Budget speech highlights – Read Full Analysis
• Tax announcements – Read Full Analysis
• Sector-wise allocations –Read Full Analysis

Download Full Union Budget 2026 PDF

Introduction of a New Income Tax Bill

The government has proposed replacing the Income Tax Act, 1961 with a new Income Tax Bill aimed at simplifying tax laws and reducing complexity.

This move is expected to modernize tax administration and improve compliance.

MSME Classification Update 

Earlier revisions in MSME investment and turnover limits expanded eligibility and encouraged business growth. Further refinements may be announced in Budget 2026.

Conclusion

The Union Budget 2026 is expected to prioritize stability, sustainable growth, and long-term reforms rather than aggressive policy shifts.

Key sectors such as manufacturing, MSMEs, healthcare, defence, and infrastructure are likely to remain at the center of government spending and reforms.

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