Common man's Budget 2026 expectations: What experts hope from the Finance Minister

As Budget 2026 approaches, expectations are rising, not just in boardrooms, but in living rooms across India. From salaried taxpayers and homebuyers to small investors, pensioners, and senior citizens, the common man is hoping the Finance Minister delivers relief, simplicity, and long-term financial security while presenting the Union Budget speech on 1 February 2026 (Sunday).

Experts believe this Budget could be a turning point if it addresses everyday concerns like high taxes, expensive housing, retirement planning, and fair treatment of investments.

1. Relief on Long-Term Capital Gains (LTCG)

Market experts believe Budget 2026 could revive investor confidence if it eases the tax burden on long-term investments and brings parity across asset classes.

"The 2026 Budget is expected to be pivotal for financial markets, with a focus on stability and tax parity. Key expectations include steps to improve investor sentiment by reducing LTCG tax to 10% and rolling back STT to encourage higher FII participation," said Aditya Agrawal, CFA, Chief Investment Officer at Avisa Wealth Creators.

2. Push for insurance penetration

Budget 2026 is expected to support wider insurance coverage across life, health, and MSMEs. "Easier credit access, simplified KYC, and clearer digital lending rules can make insurance premium financing mainstream. Tax clarity or better deductions could also encourage families to opt for adequate coverage instead of minimum insurance," said Hanut Mehta, CEO, BimaPay Finsure.

3. Separate income tax deduction for home loan principal repayments

Currently, home loan principal repayments compete with other investments under Section 80C’s ₹1.5 lakh cap. “Home loan principal repayment should not be combined under Section 80C,” said Mumbai-based tax and investment expert Balwant Jain.

4. Higher home loan interest deduction

“The deduction limit for interest on home loans should be raised to ₹5 lakh…, said NAREDCO Chairman Niranjan Hiranandani.

5. Stronger NPS benefits

The National Pension System is seen as under-utilised due to limited tax incentives.

Retirement planners believe better tax incentives can push more Indians to start saving early and consistently for their post-retirement years.

“Stronger tax incentives can encourage more people to plan for retirement early…,” said Abhishek Soni, CEO & Co-founder, Tax2win.

6. Intra-scheme mutual fund switching

Switching between growth and IDCW options or between direct and regular plans currently attracts capital gains tax. AMFI has proposed that such intra-scheme switches should not be treated as a taxable transfer, giving investors flexibility without tax penalties.

7. Revival of Sovereign Gold Bonds (SGBs)

Gold investors are seeking fairer tax treatment and the return of popular government-backed gold investment options.

"The government should consider restarting SGBs, as that was one of the best ways to earn tax-free returns on Gold," said Ronak Morjaria, Partner at ValueCurve Financial Services.

8. HRA exemption revision

Experts suggest revising HRA limits to better match today’s rental costs.

9. Faster income tax refunds

After delays last year, taxpayers are hoping Budget 2026 brings more transparency and accountability to the refund process. Experts have recommended real-time refund tracking and fair interest on delayed refunds.

10. Section 80C limit hike

Tax experts believe the long-stagnant Section 80C limit no longer matches today’s cost-of-living pressures.

“The Section 80C limit should be increased to ₹3.5 lakh…,” said Mumbai-based tax expert Jain.