Union Finance Minister Nirmala Sitharaman on Sunday presented her ninth consecutive Union Budget, in which she announced no changes in the income tax regime for the year 2026-27, while the FM announced changes to Income Tax Return (ITR) filing timelines and introduced a rule-based, automated compliance framework aimed at easing the burden on small taxpayers, among other proposals.
University townships to girls’ hostels
Five university townships in the vicinity of major industrial and logistic corridors, girls’ hostel in every district, setting up of content creator labs in 15,000 schools and 500 colleges and reduction of the tax collection at source (TCS) rate to 2 per cent for education are among the proposals announced in the Union Budget for the education sector.
Union Finance Minister Nirmala Sitharaman carries the digital tablet for Budget 2026 at the Parliament premises. PIC/PTI
The sector has got an allocation of over Rs 1.39 lakh crore, including Rs 55,727 crore for higher education. Sitharaman announced that the government will support states in creating five university townships in the vicinity of major industrial and logistic corridors. “These planned academic zones will host multiple universities, colleges and research institutions, skill centers and residential complexes,” she said in her budget speech.
Health sector gets 10 per cent hike
The Union Health Ministry has been allocated Rs 1,06,530.42 crore in the Budget 2026-27, a 10 per cent hike over 2025-26, with the government proposing a scheme to support states in establishing five regional medical hubs in partnership with the private sector to promote India as a prime medical tourism destination.
These hubs will serve as integrated healthcare complexes that combine medical, educational and research facilities, Sitharaman said. The FM said that existing institutions for Allied Healthcare Professionals (AHPs) will be upgraded and new AHP institutions established in private and government sectors. For the first time, the Union Health Ministry has allocated R1000 crore for the Scheme for AHPs. The allocation for Ayushman Bharat has been hiked from Rs 8995 crore to Rs 9500 crore.
SHE-Marts for women
To strengthen the higher education ecosystem and promote women-led entrepreneurship, the finance minister on Sunday announced a series of proposals, including the construction of a girls’ hostel in every district of the country and the setting up of community-owned ‘She MARTS’.
The Union Finance Minister also said that the government has proposed several measures to establish new institutes, university townships, girls’ hostels, and telescope infrastructure as part of increased investment in the higher education sector.
“Self Help Entrepreneur — SHE Marts’ will be set up as community-owned retail outlets within cluster-level federations through enhanced and innovative finance instruments,” said Sitharasaid. A Lakhpati Didi is a woman member of an SHG whose annual household income reaches at least R1 lakh.
‘Ambitious, futuristic’
Prime Minister Narendra Modi on Sunday described the Budget 2026-27 as “ambitious” and “futuristic”, stressing that it will further strengthen India’s global role as its 140 crore citizens are not satisfied with being the fastest growing economy and the nation is determined to soon become the world’s third largest economy.
Modi said this was a unique budget, which focused on reducing fiscal deficit and controlling inflation while simultaneously ensuring high capital expenditure and high growth. “This Budget strengthens India’s global role anew. India’s 140 crore citizens are not satisfied with being the fastest growing economy, and the nation is determined to soon become the world’s third largest economy,” he said.
Sensex, Nifty crash nearly 2%
Benchmark stock indices Sensex and Nifty dived sharply by nearly 2 per cent on Sunday after Finance Minister Nirmala Sitharaman proposed a hike in the Securities Transaction Tax (STT) on derivatives.
Reversing the early gains, the 30-share BSE Sensex plunged sharply by 2,370.36 points or 2.88 per cent to slide below the 80,000-mark at 79,899.42 in afternoon trade as the finance minister announced a hike in STT on futures contracts to 0.05 per cent from the current 0.02 per cent.
The barometer settled at 80,722.94, down 1,546.84 points or 1.88 per cent. The 50-share NSE Nifty tanked 495.20 points or 1.96 per cent to settle at 24,825.45. During the day, it tumbled 748.9 points or 2.95 per cent to 24,571.75.
Income tax regime
Under the new income tax regime for FY 2026–27, income up to Rs 4 lakh is fully exempt (due to basic exemption). A key feature of the new tax regime is the rebate under Section 87A, which effectively reduces tax liability to zero for individuals with income up to Rs 12 lakh. Salaried taxpayers also benefit from a standard deduction of Rs 75,000.
Rebate & zero tax: Increased rebate under Section 87A ensures no tax for income up to Rs 12 lakh.
Deductions: Limited deductions, primarily standard deduction, are available compared to the old regime.
New tax slabs (FY 2026–27)
Up to Rs 4 lakh : Nil
Rs 4 lakh to Rs 8 lakh: 5%
Rs 8 lakh to Rs 12 lakh: 10%
Rs 12 lakh to Rs 16 lakh: 15%
Rs 16 to Rs 20 lakh: 20%
Rs 20 lakh to Rs 24 lakh: 25%
Above Rs 24 lakh: 30%
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