Union Finance Minister Nirmala Sitharaman revealed in the Union Budget 2026-27 that certain outward remittances will become more affordable. Tax Collected at Source (TCS) on overseas tour packages and education and medical remittances will be reduced to 2 per cent. Previously, TCS on overseas tour packages ranged from 5 to 20 per cent, while education and medical remittances faced a 5 per cent tax at the source.
The budget for 2026-27 includes cuts or exemptions on basic customs duties (BCD) and transaction charges for various items. This encompasses energy-transition equipment, solar glass inputs, capital goods for critical minerals, lithium-ion cells, civilian aircraft MRO components, rare and cancer drugs, and specific textile and leather inputs.
Additionally, the budget exempts fish caught by Indian fishermen and nuclear power goods from BCD. Basic customs duties on microwave ovens and personal-use imports have been reduced from 20 per cent to 10 per cent. Import duties on graphite, quartz, coal, sand, silicon, rare-earth metals, and metal oxide have also been decreased.
Further adjustments in the budget include extending export realization periods for certain textile and leather shipments to one year. The basic customs duty on makhana and roasted nuts has been reduced to 30 per cent from 150 per cent, while duties on almonds, walnuts, seeds, and spores for sowing have been trimmed. Wet blue leather will now have zero import duty.
Regarding petroleum crude, a 5 per cent ad valorem levy has been replaced with a flat Rs 1 per tonne charge. Penalties for income tax misreporting have been increased to 100 per cent of the tax amount plus tax and interest. Futures and options trading (F&O) will incur higher costs due to the raised securities transaction tax on stock options and futures trading.
Tax collection at source (TCS) rates have been raised from 1 per cent to 2 per cent on alcoholic liquor, minerals, and scrap sales. Chewing tobacco products, including zarda and gutkha, will now face a 60 per cent National Calamity Contingent Duty (NCCD) instead of the previous 25 per cent.
The Finance Minister emphasized that the budget is built on three pillars: faster growth, inclusive development, and structural reform. The core focus of the budget, she stated, remains on the welfare of the poor and disadvantaged.
