India’s Union Budget 2026 Ahead: Key Expectations Before the Big Announcement

Budget 2026 Expectations Updates: Two days ahead of Finance Minister Nirmala Sitharaman’s Budget speech on 1 February. What are the Expectations? Want to know follow us now.

As India gears up for the Union Budget 2026-27, all eyes are on Finance Minister Nirmala Sitharaman, who will present her ninth consecutive budget on 1 February 2026. With macroeconomic indicators showing positive momentum and the government keen to consolidate gains from earlier reforms, expectations are running high across households, investors and industry alike.

One of the biggest talking points ahead of the Budget is income tax relief and changes to the tax regime. Since Budget 2025 brought sweeping simplifications making income up to ₹12 lakh effectively tax-free under the new regime and restructuring slabs, the buzz now is around modest tweaks rather than dramatic overhauls. Middle-class taxpayers are hoping for a standard deduction hike to ₹1 lakh, improved incentives for long-term investment such as a higher LTCG (long-term capital gains) exemption limit, and enhanced deductions for health insurance and medical expenses. There are also calls for easing the tax burden on homebuyers, especially first-time purchasers, through bigger interest deductions.

Senior citizens and retirees, who shoulder rising living and healthcare costs, are expected to look for better tax treatment on interest income and pension funds. Some experts are urging the government to clarify the future of the old tax regime, which still has a significant number of adherents despite the government nudging taxpayers toward the newer, simpler structure.

Beyond taxes, the Economic Survey 2025-26, tabled shortly before the Budget, paints a picture of resilient growth, with GDP projections in the ~7% range and an expanding taxpayer base both positive signals for fiscal planners. With these fundamentals in place, the Budget may strike a balance between continuing fiscal discipline and offering targeted relief where it matters most.

Sector-wise, observers are keen on announcements that support healthcare infrastructure, boost domestic manufacturing, and encourage innovation and investment, particularly in technology and startups. Enhancing ease of compliance and streamlining tax filing procedures are also high on wish lists, as these could improve the overall business climate and household financial planning.

As the countdown to 1 February continues, the narrative shaping up around Budget 2026 suggests a blend of consolidation, calibration, and cautious optimism. Whether or not every expectation comes true, the speech will set the tone for India’s economic priorities in the year ahead and millions will be listening closely to understand how the decisions made in Parliament impact their wallets and livelihoods.