Union Budget 2026-27: What Actually Changes for Your Wallet

If you were expecting a tax cut from Budget 2026-27, there isn’t one. But “no slab change” doesn’t mean “nothing changed.” A few provisions in this budget touch ordinary taxpayers even without a headline rate cut, so here’s what’s actually different.

Income tax slabs: unchanged, under both regimes

The budget didn’t propose any change to personal income tax slab rates or thresholds, in either the old regime or the new regime. If your income and deductions look the same as last year, your tax outgo should too. The government’s stated goal here was keeping the system revenue-neutral while it introduces a broader structural change (below), not squeezing more out of individual taxpayers this year.

A new Income Tax Act takes effect from April 2026

The Income Tax Act, 2025, replacing the decades-old 1961 Act, comes into force from April 1, 2026. This is primarily a simplification exercise: reorganised sections, simplified forms, and clearer language, rather than a change to how much tax you owe. If your CA or tax-filing app mentions new section numbers or reworded provisions this filing season, that’s this Act, not a new liability.

A one-time window to disclose foreign assets you missed

The budget introduced FAST-DS 2026, a time-bound voluntary disclosure scheme for taxpayers who have undisclosed foreign assets or income, aimed specifically at smaller cases rather than large-scale evasion. It runs in two parts: Part A covers undisclosed foreign assets or income under ₹1 crore, requiring 30% tax on the unreported value plus a 100% additional tax; Part B covers cases where you reported the foreign income but not the underlying asset, with a flat ₹1 lakh fee if the default doesn’t exceed ₹5 crore. If you have an old foreign bank account, ESOPs from a former overseas employer, or an inherited asset abroad that never made it onto your tax return, this scheme (and the tax professional handling your filing) is worth a conversation before the window closes.

Trading derivatives got more expensive

The Securities Transaction Tax on equity derivatives went up across the board: futures rose from 0.02% to 0.05%, options premium from 0.10% to 0.15%, and options exercise from 0.13% to 0.15%. This is aimed at discouraging high-frequency, short-term F&O speculation, which regulators have repeatedly flagged as a segment where retail traders lose money disproportionately. If you don’t trade futures and options, this doesn’t touch you; if you do, your effective cost per trade just went up regardless of whether the trade wins or loses.

Share buybacks are taxed differently now

Money you receive when a company buys back its own shares used to be taxed as a deemed dividend. The budget reclassifies it as capital gains instead, which changes your applicable tax rate and holding-period treatment if you’ve ever tendered shares in a buyback offer. Separately, companies (and their promoters) face an additional buyback-specific tax, with effective rates around 22% for corporate holders and 30% for non-corporate holders, though this side mostly affects companies and large shareholders rather than a retail investor tendering a small lot.

The actual takeaway

For most salaried readers, the honest summary is: your slab didn’t move, but the system you’re filing under is quietly being rebuilt underneath you, and a couple of narrow provisions (the foreign asset disclosure window, the buyback reclassification) matter a lot if they apply to you and not at all if they don’t. This is general information about the budget, not tax advice for your specific situation; if any of FAST-DS 2026, the buyback change, or F&O trading applies to you, that’s worth a direct conversation with a chartered accountant before you file.

FAQ

Did my income tax slab change in Budget 2026-27? No. The budget kept existing tax slab rates and thresholds unchanged under both the old and new tax regimes.

Does the STT hike on derivatives affect regular mutual fund or stock investors? No, the increase applies specifically to futures and options (F&O) trading. Buying and holding stocks or mutual funds through a regular demat/SIP route isn’t affected by this change.