This time the discussion regarding Budget 2026 is more intense. The reason is clear, the government is preparing to implement the new Income Tax Act 2025 by removing the almost 60 years old Income Tax Act 1961. It is believed that this new law may come into effect from April 1, 2026. If this happens, the tax system will become much easier for salary class, pensioners and middle class taxpayers.
The aim of the government is to make the tax law simple and transparent. By removing the section system in the new law Schedule System can be brought. That is, instead of sections like 80C, 80D, there will be different schedules, which will make it easier to file ITR and will also reduce confusion regarding tax.
Till now only Delhi, Mumbai, Kolkata and Chennai are considered as metro cities, where tax exemption on 50 percent HRA is available. in budget 2026 Bengaluru, Hyderabad and Pune Cities like these can also be included in the list of metro cities. This will provide direct tax benefits to lakhs of employees living in these cities.
At present there is no benefit of HRA in the new tax regime. But the government wants more and more people to adopt the new regime. In such a situation, it is expected that Limited HRA exemption Can also be included in the new tax regime, making this option more attractive.
At present the standard deduction in the new tax regime is ₹75,000. In view of rising inflation, it ₹1 lakh The demand to do so is gaining momentum. If this happens, the taxable income of salary class and pensioners will directly reduce by ₹25,000.
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The limit of tax free income in the new tax regime is currently around ₹7.75 lakh, which can be increased to ₹8.5 to ₹9 lakh. At the same time, it is also expected to increase the limit of 80C in the old tax regime from ₹ 1.5 lakh to ₹ 2.5 lakh and home loan interest exemption from ₹ 2 lakh to ₹ 3 lakh, which will also give impetus to the real estate sector.
