As India gears up for the Union Budget 2026-27, to be presented by Finance Minister Nirmala Sitharaman on February 1, 2026, stakeholders from various sectors are voicing their expectations. The focus is on creating a more simplified, predictable, and growth-oriented fiscal framework that balances fiscal discipline with measures to boost consumption, savings, employment, and investor confidence.
Experts emphasize continuing reforms in direct and indirect taxes, enhanced support for infrastructure, rural and MSME sectors, deeper credit access, and targeted incentives for health insurance and retirement savings. Below are insights from industry leaders highlighting priority areas for the upcoming budget.
Direct Tax Simplification and Capital Gains Structure
Shubham Gupta, CFA and Co-founder of Growthvine Capital, stresses the need for a fairer direct tax regime to improve household consumption and savings. He advocates for further simplification of GST to reduce friction in business inputs, alongside long-term infrastructure commitments in roads, transport, public digital infrastructure, and manufacturing for job creation and economic growth.
He adds: “For investors, there needs to be a sustainable capital gains tax structure. Furthermore, there should be no additional increase in capital gains tax rates and a review of the STT (Securities Transaction Tax) since it may no longer be serving its intended purpose.”
Enhancing the New Tax Regime and Support for HNIs
Prashant Mishra, founder and CEO of Agnam Advisors and a SEBI Registered Investment Advisor, calls for integrating key deductions into the new tax regime to ease compliance and provide relief amid rising costs.
He suggests: “Simplifying the new tax regime by integrating key deductions such as housing loan interest, medical insurance under Section 80D (raised to Rs 50,000 for self/family and Rs 1 lakh for seniors), and a potential 25% slab for Rs 30-50 lakh earners would ease compliance burdens and provide equitable relief amid rising living costs.”
Mishra also highlights incentives for green projects, AIFs in GIFT City, rationalizing surcharges, and family-centric boosts like higher allowances for the elderly and child care to foster wealth transfers and position India as a wealth management hub.
Deepening Trust in the Credit Ecosystem
Mr. Rohit Garg, Founder and CEO of Olyv, focuses on the evolving credit landscape: “As India’s credit ecosystem evolves, the focus in this budget should be on deepening trust, transparency, and access within the formal lending system. Clear and consistent policy frameworks for digital lending, stronger data infrastructure, and continued emphasis on financial literacy can go a long way in ensuring credit reaches the borrowers responsibly.”
He emphasizes collaboration between fintechs and regulated lenders with consumer protection at the core for a resilient and inclusive financial system.
Boosting Rural Livelihoods and MSME Resilience
Ms. Aditi Singh, Chief Strategy Officer at Satin Creditcare Network Ltd., highlights grassroots priorities: “For institutions operating at the grassroots, sustained focus on rural livelihoods, women entrepreneurship, and MSME resilience remains critical. Higher budgetary support for credit-linked social security programmes, faster transmission of policy rate changes, and continued emphasis on housing and clean energy can help deepen last-mile economic participation.”
She adds the need for a supportive regulatory environment for NBFCs to expand responsible credit in semi-urban and rural regions, sustaining economic confidence through consumption, employment, and inclusion.
Promoting Health Insurance Penetration and Prevention
Arun Ramamurthy, Co-founder of Staywell.health, underscores the low health insurance penetration: “Encouragement of health insurance through greater penetration of health insurance products in India, particularly by middle-income and elderly people, will be critical… Providing additional tax benefits on premiums paid for health insurance policies may create an economic incentive for many families to obtain and retain comprehensive health insurance coverage.”
He advocates incentives for preventative wellness programs, digital health infrastructure, low-cost products for older adults and those with chronic diseases, and partnerships to expand coverage and improve healthcare access sustainably.
Supporting Hardware Startups for Balanced Employment
Kulpreet S. Sahni, Founder and CEO of Chiltier(Tech), argues for greater emphasis on hardware startups: “As the Union budget approaches, there may be a compelling argument for more focus to be placed on hardware startups. More jobs can be created in this sector, as software companies face employee layoffs. The sector provides jobs in areas such as original design engineering and semi-skilled workers with shop floor experience, which is very important for a country like India. It will allow us to shift more rapidly towards a better-balanced economy with respect to the workforce, avoiding over reliance on University education as a means of stable employment.”
The Union Budget 2026 presents a pivotal opportunity to build on recent reforms, address middle-class and investor concerns, and drive inclusive, sustainable growth. Expectations center on tax predictability, infrastructure push, MSME and rural empowerment, enhanced credit and insurance access, and sector-specific incentives to fuel India’s economic momentum amid global uncertainties.
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