Budget 2026: Will Old Tax Regime be Abolished? Government Signals Co-existence

• Discussions are rife among India's middle class and salaried employees about the potential abolition of the Old Tax Regime in Budget 2026.
• The government has made the New Tax Regime the 'default' option and continuously tries to make it more attractive.
• Despite promotion of the New Tax Regime, Deloitte India reports that 28-29% of taxpayers still rely on the old system for savings and tax planning due to deductions and exemptions.
• Abolishing the Old Tax Regime abruptly could risk affecting domestic savings and investment culture, as many long-term financial commitments are linked to its tax benefits.
• Tax experts and brokerage houses, including Neeraj Agarwal of Nangia & Co LLP and Deloitte India, anticipate a 'co-existence' policy, meaning both tax regimes will likely remain.

Why It Matters: The government is unlikely to abolish the Old Tax Regime in Budget 2026, favoring a 'co-existence' policy.