Budget 2026 Direct Tax Proposals: Complete Summary

The Direct Tax proposals under Budget 2026 aim to simplify compliance, reduce litigation, and strengthen revenue collection while providing targeted relief.

Securities and Capital Market Measures

STT rates on futures and options have been increased, and buyback taxation has shifted to a capital gains-based approach for all shareholders.

Returns and Filing Timelines

Staggered ITR deadlines have been introduced, with revised returns allowed up to 31 March and updated returns permitted post reassessment.

MAT Reforms

From April 1, 2026, MAT will be a final tax at 14 percent, with limited credit availability under the new regime.

Asset Disclosure Window

A six-month disclosure window provides immunity for undisclosed assets subject to specified tax and fee conditions.

TDS and TCS Rationalisation

TDS and TCS rates on overseas travel, remittances, and select sectors have been reduced to improve taxpayer liquidity.

Assessment and Appeals

Single combined orders, reduced pre-deposit requirements, and extended immunity provisions aim to reduce litigation.

Conclusion

Overall, Budget 2026 direct tax proposals reflect a structured and compliance-driven approach to tax reform.