Union Finance Minister Nirmala Sitharaman presented the Union Budget 2026–27 on Sunday at a time when global uncertainty is rising, especially due to possible tariff changes by the United States.
The Budget clearly highlights which products may become cheaper for consumers and which sectors could face higher costs. On the positive side, the government has taken steps to reduce prices of sports equipment, leather goods, cancer medicines, and seafood. These measures include policy support, duty-free imports, and customs exemptions, aimed at strengthening domestic industries and easing costs for patients and producers.
In contrast, trading activity and certain corporate cash-distribution methods are expected to become more expensive due to proposed changes in buyback taxation, the securities transaction tax (STT), and tax collected at source (TCS). These measures signal the government’s tougher approach towards tax arbitrage and improved compliance. Additionally, imported coffee and alcohol may also see a rise in prices.
Products that may get cheaper
Sports equipment:
Finance Minister Nirmala Sitharaman proposed launching the Khelo India Mission, aimed at boosting employment, skilling, and job opportunities in the sports sector. This initiative is expected to improve access to and affordability of sports equipment.
Leather goods:
The government announced duty-free imports of specific inputs used in leather and synthetic footwear manufacturing. This move is expected to lower production costs for leather goods and shoe uppers.
Cancer medicines:
Customs duty has been exempted on 17 cancer medicines, and 7 additional rare diseases have been included for import duty relief. This will reduce treatment costs for patients requiring specialised medicines.
Seafood:
To support the fishing community, the Centre announced duty-free import of fish catch from beyond territorial waters.
Microwave ovens:
Specified parts used in manufacturing microwave ovens will now be exempt from basic customs duty, which could help reduce their prices.
Solar panels:
The government extended customs duty exemptions on capital goods used in lithium-ion battery cell manufacturing and removed duty on sodium antimonate used for solar glass. This could make solar panels more affordable.
EV batteries:
Import duty on machinery used to manufacture lithium-ion battery cells for energy storage systems will continue to be waived, lowering manufacturing costs and supporting domestic production.
Personal-use imports:
To improve ease of living, import duty on dutiable goods brought in for personal use has been reduced from 20% to 10%.
Travelling abroad:
TCS on overseas tour packages has been reduced to 2% from earlier rates of 5% and 20%, with no minimum threshold. This lowers the upfront cost for international travel.
Sending money abroad for education and treatment:
TCS under the Liberalised Remittance Scheme (LRS) for education and medical expenses has been cut from 5% to 2%, reducing the immediate financial burden on families.
Other items:
Duty exemptions also apply to aircraft components, goods imported for nuclear power projects, and capital goods for critical minerals.
What may get costlier
Trading and corporate payouts:
Changes to buyback taxation, STT, and TCS on selected goods could increase costs related to trading and corporate cash distributions.
Video game manufacturing:
Customs duty exemptions on parts used to manufacture video games will be withdrawn from April 1, making consoles and locally assembled gaming devices slightly more expensive.
Tax misreporting:
The Budget extends immunity from penalty and prosecution to cases of misreporting, provided full tax, interest, and an additional 100% of the tax amount are paid.
Coffee machines:
Customs duty exemptions on coffee roasting, brewing, and vending machines will be withdrawn from February 2, potentially increasing costs for cafés and businesses.
Imported alcohol:
The TCS rate on alcoholic liquor for human consumption will be revised to 2%, up from the current 1%.
Zoo animals and birds:
The government has withdrawn duty exemptions on animals and birds imported by zoos.
Fertilisers:
Customs duty exemption on naphtha used in fertiliser production has been removed.
Other items:
Umbrellas, ATM and cash dispenser machines and their parts, and film and broadcasting equipment used by foreign crews may also become more expensive.
