Budget 2026: Emerging Sectors Demand Tax Reforms for Innovation and Growth

• Budget 2025 increased allocations for innovation, R&D, and a national framework for Global Capability Centers (GCCs) was announced.
• The Rs 1 trillion Research, Development and Innovation (RDI) scheme aims to foster innovation and private sector collaboration for Viksit Bharat by 2047.
• New-age sectors require a favorable tax regime, deferred taxation for long-gestation projects, and accelerated depreciation for high-tech machinery.
• Incentives for lenders, simplification of the patent box regime, and extension to other IP are crucial for capital and intellectual property.
• Reintroducing tax holidays for GCCs and removing the revenue cap for safe harbor provisions would boost the knowledge sector.

Why It Matters: Budget 2026 must prioritize tax reforms and incentives for emerging tech and innovation sectors to drive India's economic growth.