Budget 2026: The upcoming Union Budget 2026 is expected to bring another round of relief for taxpayers as the government continues its focus on tax reforms, simplification, and compliance. Finance Minister Nirmala Sitharaman has consistently taken steps in previous budgets to reduce the tax burden and make the system more transparent. From making income up to ₹12 lakh tax-free in Budget 2025 to revamping capital gains rules in Budget 2024, the trend clearly shows a taxpayer-friendly approach.
Now, as expectations build ahead of Budget 2026, tax experts believe that the Finance Minister may announce five major changes that could significantly benefit salaried individuals, investors, and middle-class families.
The cryptocurrency industry is hoping for a major announcement in Budget 2026. Currently, crypto transactions attract 1% TDS on every trade and 30% flat tax on profits, with no set-off for losses. These strict rules were introduced in the 2022 budget and have since reduced trading volumes in India.
Industry experts believe the government may relax these norms by:
Reducing the 1% TDS rate
Allowing loss set-off
Introducing a more reasonable tax slab structure
If this happens, it could revive crypto participation and bring more transparency to the digital asset market.
In Budget 2024, the government raised the tax-free limit on long-term capital gains (LTCG) from equities and equity mutual funds to ₹1.25 lakh per year. Now, experts are expecting this limit to be increased further to ₹2 lakh in Budget 2026.
An enhanced exemption limit would:
Encourage long-term investing
Boost retail participation in equity markets
Improve household wealth creation
This move would be especially beneficial for small and middle investors who rely on mutual funds for long-term goals.
The new tax regime currently offers a basic exemption limit of ₹4 lakh, meaning income up to this amount is tax-free. Tax professionals suggest that this should be raised to ₹5 lakh to provide relief to low-income earners.
If implemented, this change would:
Reduce tax liability for entry-level earners
Support inflation-hit households
Make the new regime more attractive compared to the old regime
Such a step would strengthen the government’s image as pro-middle class.
At present, deductions on term life insurance (Section 80C) and health insurance (Section 80D) are available only under the old tax regime. Experts are urging the government to extend these benefits to the new regime as well.
Allowing insurance deductions in the new regime would:
Encourage financial protection
Promote health security
Increase adoption of the new tax system
This could be a game-changer for families seeking both tax savings and financial safety.
Since April 1, 2023, debt mutual funds have lost their long-term capital gains benefits. Now, all gains are taxed as short-term capital gains based on the investor’s income slab. This change has reduced the attractiveness of debt funds.
In Budget 2026, the government may:
Reintroduce LTCG benefits
Lower tax rates on debt fund gains
Offer indexation benefits again
Such steps would revive investor interest and support stable investment options.
Over the past few years, the government has taken a progressive approach toward tax reforms. Budget 2020 introduced the new tax regime, Budget 2024 revamped capital gains rules, and Budget 2025 gave a historic tax exemption up to ₹12 lakh. Budget 2026 is expected to continue this momentum.
Experts believe the government aims to:
Simplify tax laws
Improve compliance
Increase disposable income
Boost consumption and investment
Budget 2026 could be a turning point for taxpayers if these expected announcements become reality. From crypto investors to salaried employees and mutual fund investors, everyone is hoping for meaningful relief. With elections approaching and economic growth in focus, all eyes are now on Finance Minister Nirmala Sitharaman’s next move.
