Income Tax Slab News Live: FM Sitharaman Hikes STT On F&O, Extends Revised Timelines For Filing ITRs

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In a major compliance-relief step under Budget 2026-27, the government has introduced a one-time, six-month Foreign Asset Disclosure Scheme aimed at helping small taxpayers who unintentionally failed to declare overseas assets or income in earlier years. The Finance Minister noted that students, young professionals, tech employees, relocated NRIs, and others with small-value foreign holdings often faced practical challenges in meeting stringent foreign-asset reporting requirements. The new scheme is designed to offer an accessible, penalty-protected pathway for regularising such disclosures.

For more details, read — Budget 2026: One Time Foreign Asset Amnesty for Small Taxpayers Declared — Check Window

Jashan Arora, Director at Master Trust Group says, 

"Markets are likely to remain volatile and largely range-bound in the near term as higher transaction costs weigh on investor sentiment, particularly in the derivatives segment. The increase in STT and F&O-related costs could dampen trading volumes, putting near-term pressure on brokerages and exchanges that are heavily dependent on market activity. This may also lead to more cautious participation from retail traders, adding to short-term uncertainty.
The broader macro picture remains supportive. The Budget strikes a careful balance between growth and fiscal discipline, reinforcing the government’s commitment to capital expenditure without compromising on consolidation. This is constructive for the medium-term outlook, especially for banks and infrastructure companies.
Capex-led growth is expected to drive sustained credit demand, improving asset quality and earnings visibility for banks. Infrastructure players should benefit from continued public spending and project execution. Overall, investors may see selective stock-specific opportunities, with a clear preference for banks and infrastructure over high-risk capital market-linked stocks in the current environment."

Swapnil Aggarwal, Director, VSRK Capital says, "Union Budget 2026 marks a critical phase for the Indian capital markets. Although the increase in Securities Transaction Tax (STT) on Futures from 0.02 % to 0.05 % and on Options premiums has caused short-term setbacks in derivatives trading volumes and impacted brokerage and exchange stocks heavily, it also symbolizes the Government’s effort to standardize market participation costs. This has resulted in sell-offs in major broking stocks and increased market volatility. ( STT is only in equity not commodity)

However, the strategic move to enhance the Portfolio Investment Scheme by allowing foreign individuals to purchase Indian stocks directly with the individual limit hiked from 5 % to 10 % and the overall limit raised from 10 % to 24 % is highly significant. This ease in market access for NRIs and foreign investors takes place when traditional FPI investments have gradually slowed down, and could open doors to deeper and more stable capital investments in Indian equities.
Going forward, we forecast rotational investments in infrastructure, financials, specific manufacturer and export-oriented sectors, and long-term investors may also gain from enhanced market liquidity and foreign participation due to these reformative initiatives." 

The Union Budget 2026 has eased the cost of travelling abroad for Indians. Finance Minister Nirmala Sitharaman, in the Parliament today, announced a reduction in the Tax Collected at Source (TCS) on overseas tour packages, making foreign travel more affordable. The TCS on overseas tour programme packages will now be levied at a flat 2%, replacing the earlier structure of 5% for packages up to Rs 10 lakh and 20% on higher‑value bookings.

For more details read: TCS On Overseas Tour Packages Slashed To 2% In Major Relief For Travellers

Vivek Jalan, partner at Tax Connect Advisory Services, a Multi-disciplinary PAN India Taxation Firm says, "Union Budget 2026-27 Champions the cause of MSMEs, Manufacturing and Foreign Funding. MSMEs have been supported by a host of proposals including Equity Support wherein Rs.10000 Crores have been allocated for SME Growth based on select criteria. Also by Strengthening TReDS as a platform for purchase, invoice discounting, and boosting receivables. To ease compliances of Micro Enterprises Professional Organisations like ICAI, ICMAI, ICSI would develop "Corporate Mitras" who will champion compliances." 

The Union Budget 2026 brings a wave of significant reforms for salaried taxpayers, with Finance Minister Nirmala Sitharaman emphasising simpler compliance, reduced litigation, and meaningful relief for individuals. A major highlight is the rollout of the Income Tax Act 2025, which will replace the 1961 law and come into force on April 1, 2026.

Sitharaman noted that tax forms have been redesigned to ensure “ordinary citizens can comply without difficulty,” marking a major shift toward user-friendly processes.

Read More Details Here: Are You A Salaried Taxpayer? Here's What Changes For You

The Union Budget 2026 has provisioned Rs 95,692 crore for the rural employment scheme Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAM G). The law guarantees 125 days of wage employment per rural household in each financial year to such rural households whose adult members volunteer to undertake unskilled manual work. The MGNREGA programme component is Rs 30,000 crore.

In 2025, the government allocated Rs 86,000 crore to MGNREGA, the same as the previous two years. In December, the Modi government passed The Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAM G) Act for what it called a "comprehensive statutory overhaul of MGNREGA, aligning rural employment with the long-term vision of Viksit Bharat 2047, while strengthening accountability, infrastructure outcomes and income security".

Read More Here: Govt Provisions Rs 95,692 Crore For Rural Jobs Scheme Under VB-G RAM G

Unveiled on the twin occasions of Magh Purnima and Guru Ravidas Jayanti, the Union Budget 2026 was positioned by Finance Minister Nirmala Sitharaman as a continuation of 12 years of economic stability and disciplined fiscal stewardship. The government framed the document around three guiding ‘Kartavya' pillars—productivity‑led growth, national capacity creation and universal opportunity access—signalling a push toward a more competitive, future‑ready economy.

For full highlights read — Budget 2026 Key Highlights: Big Capex Push, STT Hike, Manufacturing Boost Lead India's Next Growth Wave

FM Sitharaman has proposed that buyback proceeds for all categories of shareholders will now be taxed as capital gains, moving away from earlier mechanisms that treated different shareholders differently. Announcing a major change in the taxation of share buybacks in her Budget speech, she explained that under the new structure, corporate promoters will face an effective tax rate of 22%, while non‑corporate promoters will be taxed at 30% on buyback transactions.

Read More Here: Buyback For All Shareholders To Be Taxed As Capital Gains, Announces FM Sitharaman

Finance Minister Nirmala Sitharaman proposed to hike Securities Transaction Tax (STT) on derivatives trades. Aimed at curbing speculative trading in the high-volume futures and options (F&O) segment, STT on futures will be raised from 0.02% to 0.05%. The impact on options is even more pronounced, with tax on option premiums set to increase from 0.1% to 0.15% while the STT on the exercise of options will rise from 0.125% to 0.15%.

Read More Here: BSE Shares Hit Lower Circuit As Nirmala Sitharaman Makes Key F&O Announcement

"I propose to increase the limit for duty-free imports of specified inputs used for processing sea foods for export from the current 1% to 3% of FOB value of the previous year's export turnover. I also propose to allow duty-free imports of specified inputs which is currently available for exports of leather or synthetic footwear to exports of shoe uppers as well,'' said FM Sitharaman.

On direct taxes, Union Finance Minister Nirmala Sitharaman says,"...I propose to reduce TCS rate on sale of overseas tour program packages from current 5% and 20% to 2% without any stipulation of amount. I propose to reduce the TCS rate for pursuing education and medical purposes under the liberalised remittance scheme from 5% to 2%..."

FM Nirmala Sitharaman says, "I propose to extend time available for revising returns from 31st December to up to 31st March with the payment of a nominal fee. I also propose to stagger the timeline for filing of tax returns - individuals with ITR 1 and ITR 2 will continue to file till 31st July and non-audit business cases or trust are proposed to be allowed time till 31st August,'' said FM Sitharaman.

"I propose a scheme for small taxpayers wherein a rule-based automated process will enable obtaining a lower or nil deduction certificate instead of filing an application with the assessing officer. For the ease of taxpayer holding securities in multiple companies, I propose to enable depositories to accept Form 15G or Form 15H from the investor and provide it directly to various relevant companies,'' said FM Sitharaman

''I propose to reduce TCS rate for pursuing education and for medical purposes under the liberalised remittance scheme, popularly known as LRS, from 5% to 2%,'' she said.

Union Finance Minister Nirmala Sitharaman says,"...The Government has accepted 16th Finance Commission recommendations to retain the vertical share of devolution at 41%. I have allocated Rs 1.4 lakh crores for states for FY2026-27.''

FM Sitharaman has proposed TDS on sale of immovable property by NRI to be deducted by resident buyer compared to earlier requirement of TAN. She has also proposed to allow taxpayers to update returns even after reassessment proceedings have been completed with 10% tax. FM has proposed to rationalise prosecution framework in Income Tax Act.

"I propose to reduce TCS rate on the sale of overseas tour program package from the current 5% and 20% to 2% without any stipulation of amount,'' said FM Sitharaman.

FM Nirmala Sitharaman says, "I propose that any interest awarded by the motor accident claims tribunal to a natural person will be exempt from income tax and any TDS on this account will be done away with."

FM Sitharaman has proposed a revised timeline for filing income tax returns with a minimal fee. She has proposed to extend time available to revise returns with payment of nominal fee. Individuals with ITR1 and ITR2 to continue to file till July 31. Non-audit business cases, Trusts will be allowed time to file returns to Aug. 31

New Income Tax Act rules and regulations to come into effect from April 1, 2026.

Union Finance Minister Nirmala Sitharaman says,"... Individual Persons Resident Outside India (PROI) will be allowed to invest in equity instruments of listed Indian companies through the Portfolio Investment Scheme. It is also proposed to increase investment for PROI from 5% to 10%."

FM Sitharaman proposes to increase public capex to Rs 12.2 lakh crore in Budget 2026

To scale up manufacturing in strategic and frontier sectors, the Union Finance Minister proposes to launch:

• Biopharma SHAKTI
• India Semiconductor Mission (ISM) 2.0
• Electronics Components Manufacturing Scheme
• Dedicated Rare Earth Corridors in Odisha, Kerala, Andhra Pradesh and Tamil Nadu
• Three dedicated Chemical Parks
• Scheme to revive 200 legacy industrial clusters

FM Sitharaman says, "Given that this is the first Budget prepared in Kartavya Bhavan, we are inspired by 3 kartavya.

First kartavya is to accelerate and sustain economic growth by enhancing productivity and competitiveness and building resilience to volatile global dynamics.

Second kartavya is to fulfill aspirations of our people and build their capacity, making them strong partners in India's path to prosperity.

Third kartavya, aligned with the vision of Sabka Saath Sabka Vikas, is to ensure that every family, community, region and sector has access to resources, amenities and opportunities for meaningful participation,'' she added.

"...A scheme for rare earth permanent magnets was launched in 2025. We now propose to support the mineral-rich states of Odisha, Kerala, Andhra Pradesh, and Tamil Nadu in establishing dedicated rare-earth corridors,'' said FM Sitharaman.

''We will launch India Semiconductor Mission 2.0 and also focus on industry-led research and training centres to develop tech and skilled workforce,'' she added.

" To accelerate and sustain economic growth, I propose interventions in six areas -Scaling up manufacturing in seven strategic sectors; Rejuvenating legacy industrial sectors; Creating champion MSMEs; Delivering a push for infra; Ensuring long-term security and stability; Developing city economic regions,'' said FM Sitharaman while announcing announcements of Budget 2026.

''..To develop India as a global bio-pharma manufacturing hub, I propose Bio Pharma Shakti with an outlay of Rs 10,000 crores over the next five years. This will build an ecosystem for domestic productions of biologics and biosimilars,'' said FM Sitharaman.

FM Sitharaman has proposed setting up a Rs 10,000-crore worth MSME growth fund for incentivizing and develop the small and medium enterprises.

"We have pursued far-reaching structural reforms. Fiscal prudence and monetary stability, while maintaining a strong thrust on public investment, keeping self-reliance as a pillar. We have built domestic manufacturing capacity, energy security and reduced critical import dependencies,'' said FM Sitharaman.

Presenting Union Budget 2026-27. Union Finance Minister Nirmala Sitharaman says," Since we assumed office 12 years ago, the country's economic trajectory has been marked by stability, fiscal discipline, sustained growth and moderate inflation. This is the result of conscious choices we have made even in times of uncertainty and disruptions."

Finance Minister Nirmala Sitharaman is now presenting Budget 2026 in the Parliament :

A recent KPMG survey shows that a majority of salaried taxpayers are seeking a higher standard deduction. According to the findings, 73% of respondents feel the government should substantially raise the current ₹75,000 deduction, especially amid discussions around gradually phasing out the old tax regime.

The survey also highlights expectations around manufacturing-related tax reforms. With several existing tax incentives either expired or nearing their sunset dates, 34% of participants want the government to reintroduce a lower tax rate framework tied to manufacturing activity. Additionally, half of the respondents believe the government should prioritise targeted, sector‑specific incentives to boost industry growth.
 

Continuing on the sharp drawdown over the last two days, Silver prices fell again Sunday morning, falling up to 10% on the MCX as the global sell-off in the metals market continues.

The Silver MCX is currently trading at around Rs 2.65 lakh, accounting for a 9% fall from the last closing price. The Silver MCX prices are down 36% from record highs, a drawdown that is part of a larger correction in precious metals.

The fall in the silver price comes on the back of Donald Trump's announcement of Kevin Warsh becoming the successor to Jerome Powell as the US Federal Reserve Chairman. READ FULL STORY HERE

Union Finance Minister Nirmala Sitharaman and MoS Finance Pankaj Chaudhary, along with their team, arrive at the Parliament.

President Droupadi Murmu feeds Union Finance Minister Nirmala Sitharaman the customary 'dahi-cheeni' (curd and sugar) ahead of her ninth consecutive Union Budget presentation.
 

Bank of Baroda expects capital expenditure to rise to Rs 12-12.1 lakh crore in FY27 (3.1% of GDP).

Higher allocations likely for defence, railways and roads.

Greater use of PPP models to attract private investment and support the investment cycle

For income tax (individuals), Bank of Baroda expects:

• Income tax buoyancy expected to remain strong (0.9-1.1).
• Possible increase in:
• Standard deduction to Rs 1 lakh.
• Long-term capital gains (LTCG) exemption on equity/equity MFs to Rs 2 lakh.
• Sovereign green bonds for retail investors may offer a 25 bps premium over G-Secs

''Looking forward to what the finance minister has to tell us'': Shashi Tharoor

Here are the income tax slabs for the old tax regime -

• Income up to Rs 2,50,000 - Nil
• Rs 2,50,001 to Rs 5,00,000 - 5%
• Rs 5,00,001 to Rs 10,00,000 - 20%
• Income above Rs 10,00,000 - 30%

Under new tax regime

• Income up to Rs 3,00,000 - Nil
• Rs 3,00,001 to Rs 6,00,000 - 5%
• Rs 6,00,001 to Rs 9,00,000 - 10%
• Rs 9,00,001 to Rs 12,00,000 - 15%
• Rs 12,00,001 to Rs 15,00,000 - 20%
• Income above Rs 15,00,000 - 30%

A taxpayer in the new regime with an income of Rs 12 lakh will get a benefit of Rs 80,000 in tax for assessment year 2025-26, which is 100% of tax payable as per existing rates, FM Sitharaman said. "While the exemption applies up to Rs 12 lakh, the rates across income bands have been reduced, ensuring lower taxes for all. The aim is to benefit the middle class without letting higher incomes escape taxation,'' Sitharaman said, while speaking to state broadcaster Doordarshan.

In Odisha, women entrepreneurs share their Budget expectations to ANI:

Jajpur's Maitri said "I expect that the essential commodities, a two-stove gas burner, for instance, are really essential for the middle class and lower income class. There is 18% GST on it. It should be lowered. There is very high air pollution these days. GST on air purifiers should be lowered and it should be made cheaper.''

''Just like every year, Income Tax slab should be redefined...Tax structure should be such that there is maximum reach to the tax-paying population. As a woman entrepreneur, I would want a little tax relief for women-led businesses and completely women-owned businesses so that more and more women enter businesses and create employment...'' she added.

Finance Minister Nirmala Sitharaman Arrives At Kartavya Bhawan

WATCH: Union Finance Minister Nirmala Sitharaman leaves from her residence for the Ministry of Finance, ahead of the presentation of the Union Budget 2026-27

The stock market will remain open for trading on the day of Budget presentation, on Feb. 1. The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have each issued circulars confirming that regular trading will take place on Budget day.

The exchanges stated that market timings will remain the same as on a normal trading day. According to the notices, the pre-open session will begin at 9 am and conclude at 9:08 am. Catch all live stock market updates with NDTV Profit here

The finance minister is also expected to outline both short-term priorities and long-term goals in Part B of her Budget speech, highlighting the country's local strengths and global ambitions.

India's GDP is expected to grow 7.4% for the year ending March 31 with the help of government spending on infrastructure, and income and consumption tax cuts that boosted consumer spending. Catch all live updates for Union Budget 2026

Income Tax Slab News Live: Finance Minister Nirmala Sitharaman will unveil Modi 3.0 government's third straight budget on Feb. 1, 2026. India's middle-class and salaried employees are expecting more income tax cuts in India Budget 2026. D-Street investors are eyeing exemption on higher LTCG tax and STT.