Legal and Policies
Union Budget set for Sunday, February 1 as calendar cleared
NEW DELHI: India’s biggest financial day may arrive with a weekend twist. The Union Budget 2026–27 is likely to be presented on 1 February, which falls on a Sunday, according to media reports, after the Cabinet Committee on Parliamentary Affairs approved the Parliament calendar. If confirmed, it would mark the first time the budget is delivered on a Sunday, giving tradition a gentle nudge aside.
The budget Session of Parliament will begin on January 28 with the President’s address to a joint sitting of both Houses. The Economic Survey, which sets the mood music for budget day, is scheduled to be tabled on January 29.
All eyes will again be on Finance Minister Nirmala Sitharaman, who is poised to present her eighth consecutive Union Budget. That feat would make her the first finance minister in India’s history to deliver eight budgets in a row. The upcoming exercise will also be the 80th Union Budget since Independence.
Since 2017, the budget has been presented on February 1 at 11 am, a shift designed to speed up the rollout of policies from the start of the new financial year. While a Sunday budget would be a first, weekend presentations are not entirely new. Sitharaman presented the 2025 budget on a Saturday, and former finance minister Arun Jaitley delivered budgets on Saturdays in 2015 and 2016.
With eight budgets, Sitharaman moves closer to the record held by Morarji Desai, who presented 10 budgets across two stints. Among more recent finance ministers, P Chidambaram presented nine budgets, while Pranab Mukherjee delivered eight.
Appointed India’s first full-time woman finance minister in 2019, Sitharaman has retained the portfolio through three consecutive terms of the Narendra Modi government. If the Sunday schedule holds, budget day this year will come with fewer office commutes, but no shortage of attention.
Legal and Policies
India’s new income tax law and higher F&O levies take effect from 1st April
A sweeping overhaul of the tax code, stiffer securities transaction taxes and relief for travellers and tech firms all land at once
NEW DELHI: India’s tax landscape shifts gears on Tuesday. The Income-tax Act, 2025, which replaces the Income-tax Act, 1961, comes into force from April 1, 2026, alongside a clutch of budgetary measures that will be felt by traders, tourists, technology firms and ordinary taxpayers alike.
The new Act is not a reinvention of tax policy so much as a tidying up of it. Gone is the unwieldy distinction between the assessment year and the previous year; in its place comes a single “tax year” framework designed to be more logical and reader-friendly. Taxpayers will also, for the first time, be able to claim tax deducted at source refunds even when income tax returns are filed after the deadline, without incurring penal charges.
For those who trade derivatives, however, the news is less comfortable. Securities transaction tax on futures contracts rises to 0.05 per cent from 0.02 per cent, while STT on options premiums and the exercise of options is hiked to 0.15 per cent from 0.1 per cent and 0.125 per cent respectively. The government has made no secret of its intent: the higher levy is aimed squarely at curbing speculative bets in the futures and options segment and shielding retail investors from ruinous losses. The numbers tell a grim story. The number of individual investors active in the F&O segment fell from 1.06 crore in FY25 to about 75.43 lakh by December 2025. A Sebi study found that individual investors had racked up net losses of more than Rs 1.05 lakh crore in FY25 alone.
Overseas travellers and those remitting money abroad for medical and education purposes get some relief. Tax collected at source on overseas tour packages has been slashed to 2 per cent from 20 per cent, while TCS on Liberalised Remittance Scheme transfers for medical and educational purposes drops to 2 per cent from 5 per cent.
The data centre industry, too, has reason to cheer. Any foreign company procuring data centre services in India will enjoy a 20-year tax holiday stretching to 2047, shielding its global income from Indian tax authorities. Whether a global firm sets up its own facility or simply buys services from an Indian data centre, the tax treatment will be identical, ensuring a level playing field. India’s effective corporate tax rate stands at 25.17 per cent.
Software companies get a further fillip: the safe harbour threshold for IT services has been raised sharply from Rs 300 crore to Rs 2,000 crore, a move designed to reduce litigation and give the sector greater certainty.
On the transition, the income tax department has confirmed that its e-filing portal will handle compliance under both the old and new Acts during the switchover period. Taxpayers filing returns for assessment year 2026-27, which covers the period governed by the old Act, will do so in July 2026 using the old forms. Advance tax payments for tax year 2026-27, commencing from June 2026, will follow the new Act.
One sweeping law, several sharp edges, and a deadline that waits for no one.
