Budget 2026: Nirmala Sitharaman to Focus on Middle Class Taxpayers, Relief Expected

• The new income tax regime, introduced in Union Budget 2020, is gaining popularity among taxpayers due to government efforts to make it more attractive.
• Over 9 crore Income Tax Returns filed, with more than 5.2 crore under the new regime in AY 2024-25, indicating increased compliance.
• Government increased standard deduction to Rs 75,000 and made income up to Rs 12 lakh tax-free in the new regime, benefiting salaried individuals.
• Experts suggest relief for middle-class taxpayers (income Rs 5.5 lakh to Rs 20 lakh) will boost consumption and address declining household savings.
• Finance Minister Nirmala Sitharaman may allow deductions for insurance premiums and link tax slabs to inflation in the new regime for further relief.

Why It Matters: Nirmala Sitharaman is expected to announce significant relief for middle-class taxpayers in Budget 2026.