Hello Mumbai Business Desk 

1. Budget Overview
Union Budget 2026–27 is reform-oriented and growth-focused, emphasizing fiscal discipline, ease of doing business, infrastructure-led growth and compliance simplification. The budget avoids populism and focuses on long-term economic stability.
2. Fiscal Position & Economic Stability
Fiscal deficit for FY 2026–27 is estimated at 4.4% with a medium-term target of reducing debt-to-GDP ratio to nearly 50% by 2031. Continued high capital expenditure of Rs.12.2 lakh crore strengthens infrastructure and investment confidence.
3. Income Tax Reforms – New Income Tax Act, 2025
A new simplified Income Tax Act effective from 1 April 2026 aims to reduce litigation and improve tax certainty. Assessment and penalty proceedings are merged into a single order, and appeal pre-deposit is reduced to 10%.
4. TDS / TCS Rationalisation
TCS on overseas tour, education and medical remittances reduced to 2%. Automated lower or nil TDS certificate system introduced. Manpower supply classified as contractor for TDS, providing long-awaited clarity.
5. Return Filing & Compliance Relief
Timeline for revised returns extended till 31 March. Scope of updated returns expanded, enabling voluntary compliance and reducing penal exposure.
6. NRI & Foreign Asset Provisions
FAST-DS 2026 introduces a one-time foreign asset disclosure window with immunity provisions for eligible taxpayers. Property purchase from NRIs simplified through PAN-based TDS challan without TAN requirement.
7. Corporate & Capital Market Taxation
MAT rate reduced to 14% and made final tax. Buybacks taxed as capital gains and STT rates increased for F&O; transactions, requiring reassessment of dividend versus buyback strategies.
8. International Taxation & IT Sector
Unified safe harbour regime for IT services at 15.5% with threshold increased to Rs.2,000 crore. Data centres and cloud service providers granted tax holiday till 2047, positioning India as a global digital hub.

9. MSME & Business Ecosystem

Rs. 10,000 crore dedicated MSME growth fund for business expansion, scaling and growth.
Rs. 2,000 crore added to Self reliant India fund and more equity tyoe support for MSME.
TReDS platform and receivable securitisation improves MSME liquidity and funding access.
CGTMSE ( Corporate Guarantee Trust Sccheme for Micro Small and Medium Enterprise) for invoice discounting on TReDS for easier bill discounting and Working capital limits.
Gem Platform will be linked to TreDs so that MSMEs supplying to Government get faster finance.
Enhanced role for professionals in compliance and advisory called as “ Corporate Mtras”
Courier Export value limit of Rs. 10 lakh removed which means small exporters can ship higher value through courier.
For Manufacturing Industries:
Government has announced strengthened scheme for :
Electronics components manufacturing
Integrated textile programme
3 chemical parks
Hi-tech tool rooms
Semiconductor Mission 2.0
Sports goods manufacturing
Revival of 200 industrial clusters Biopharma SHAKTI – support for biopharma and biotech manufacturing expansion and technology upgrade.
Focus is on technology upgrade, capacity expansion and domestic manufacturing.

10. Indirect Taxes & Trade Facilitation
Customs duty simplification, export incentives for textiles, seafood and leather sectors, and AI-based customs clearance reduce logistics costs and classification disputes.
11. Exporters and Export Oriented manufacturer:
– 5 year income tax exemption to non resident suppliers of capital goods/ tooling for toll manufacturing in boned zones.
– Safe-harbour for component warehousing in bonded warehouses
– Deferred customs duty payment for trusted manufacturers will improve cash flow.
-Duty-free input limit for seafood exporters has increased from 1% to 3%.
-Duty free inputs has also been extended to shoe uppers.
-Timeline for export of finished goods for textile and footwear exporters has increased from 6 months to 1 year.
-Zero basic custom duty on
– microwave oven parts
– aircraft manufacturing parts
– raw material for aircraft MRO/defence units
-Export cargo for electronic sealing allowed from factory to port fr faster logistics
-One time facility for eligible SEZ manufacturing units to sell in domestic market at concessional duty.

12. Advisory Note :
Clients are advised to review tax structures, reassess capital distribution strategies, regularise foreign assets where applicable, and align compliance systems with the new tax regime to optimise long-term benefits.