Why in the News?
The Union Budget of India for 2026–27 was presented on 1 February 2026 by Nirmala Sitharaman, focusing on Yuva Shakti, inclusive growth and long term economic resilience.
Budget Theme and Vision
- Yuva Shakti driven Budget with focus on poor, underprivileged and disadvantaged
- First Budget prepared in Kartavya Bhawan
- Anchored on 3 Kartavya
- Accelerate and sustain economic growth
- Fulfil aspirations and build capacity
- Sabka Sath Sabka Vikas towards Viksit Bharat
Major Economic and Fiscal Announcements
- Public Capex increased to ₹12.2 lakh crore in FY 2026–27
- Fiscal deficit targeted at 4.3 percent of GDP
- Debt to GDP ratio projected at 55.6 percent
- Net market borrowing at ₹11.7 lakh crore
Taxation Reforms
Direct Taxes
- New Income Tax Act, 2025 effective from April 2026
- Simplified income tax rules and forms
- TCS on overseas tour packages reduced to 2 percent
- STT on futures increased to 0.05 percent
- MAT rate reduced to 14 percent and made final tax
- Multiplicity of penalty and prosecution proceedings reduced
Support to IT and Global Investment
- Single category of IT Services with safe harbour margin of 15.5 percent
- Safe harbour threshold raised to ₹2,000 crore
- Foreign cloud service providers to get tax holiday till 2047
- MAT exemption to all non residents paying tax on presumptive basis
Indirect Taxes and Customs
- Basic customs duty exemption
- Capital goods for lithium ion batteries
- Critical minerals processing equipment
- 17 drugs and medicines
- Tariff on personal imports reduced from 20 percent to 10 percent
- Customs warehousing shifted to operator centric digital system
- Single digital window for cargo clearance by end of financial year
Sector Specific Highlights
Manufacturing and MSMEs
- ₹10,000 crore SME [Small and Medium Enterprises] Growth Fund
- Scaling manufacturing in 7 strategic sectors
- Textile sector integrated programme including Samarth 2.0
Infrastructure and Transport
- Seven high speed rail corridors as growth connectors
- New Dedicated Freight Corridors
- Operationalisation of 20 National Waterways
Health, Education and Social Sector
- Biopharma SHAKTI with outlay of ₹10,000 crore
- One girls hostel in every district for STEM institutions
- Medical tourism hubs in partnership with private sector
- NIMHANS 2 and mental health institutes upgrade
Technology and AI
- Bharat VISTAAR multilingual AI tool for agriculture
- AVGC content creator labs in 15,000 schools and 500 colleges
Sports and Tourism
- Launch of Khelo India Mission
- Upskilling 10,000 tourist guides
- Buddhist Circuit development in North East
| [2024] With reference to Union Budget, consider the following statements:
1. The Union Finance Minister on behalf of the Prime Minister lays the Annual Financial Statement before both the Houses of Parliament 2. At the Union level, no demand for a grant can be made except on the recommendation of the President of India Which of the statements given above is/are correct? (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2 |
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