Will Budget 2026 make new income tax regime even better?
What's the story
As the Budget 2026 nears, salaried and middle-class taxpayers are eagerly waiting for Finance Minister Nirmala Sitharaman's announcement on February 1. The anticipation comes after the major tax reforms of 2025, including a revamped new income tax regime and changes in GST rates. Now, the focus is on whether the government will introduce more incentives to attract taxpayers to this new system.
Expert opinions
Experts predict stability over major changes
Experts are cautious about expecting major changes in the upcoming budget. Preeti Sharma, Partner at BDO India, told TOI that "big changes to tax slabs are unlikely in this year's Budget," given the major improvements made to the new income tax regime in Budget 2025. Surabhi Marwah of EY India echoed this sentiment, saying that the focus is likely on "stability and a smooth transition rather than additional reforms."
Potential enhancements
Incremental measures could enhance new regime's appeal
Despite the cautious outlook, experts agree that incremental measures could make the new income tax regime more appealing. This is especially true for middle-class taxpayers who still find value in the old regime due to deductions. The new system has already gained traction with simplification, higher exemptions, and increased taxpayer adoption. Budget 2026 may not bring drastic changes but selective measures could further enhance its attractiveness.