Income tax change expectations from Budget 2026: Full list of proposals by ICAI, FICCI, Assocham

With Union Budget 2026–27 approaching, India’s leading professional and industry bodies have outlined their expectations from the government. From individual tax relief to long-pending dispute resolution, the proposals from ICAI, Assocham and FICCI focus on simplifying taxes, easing compliance and supporting economic growth.

ICAI: Make the new tax regime more practical for individuals

The Institute of Chartered Accountants of India (ICAI) has formally submitted its pre-Budget memorandum, calling for targeted relief for individual taxpayers, especially those who have shifted to the new tax regime, now the default option.

ICAI’s most significant suggestion is to allow deductions for health insurance premiums under the new regime. At present, taxpayers opting for this regime cannot claim Section 80D benefits, even though medical insurance has become a basic household expense. ICAI has also sought a higher surcharge threshold and deductions for the maintenance of dependent disabled family members.

Structural tax changes proposed by ICAI

It has also pushed for simplified return processing, rationalised penalties, and a year-wise e-ledger to help taxpayers track taxes paid.

Assocham: Push investment and cut litigation

On the indirect tax side, Assocham has called for a comprehensive customs amnesty scheme and faster implementation of voluntary disclosure provisions to reduce litigation.

FICCI flags concerns on disputes and buyback tax

As per several media reports, FICCI has highlighted anomalies in the new buyback tax regime, particularly where buybacks are funded through share premium or fresh issue proceeds.

It has also flagged the growing backlog of income-tax appeals and the complexity of having over 37 different TDS rates, urging the government to simplify rates, speed up dispute resolution and adopt a more practical stay-of-demand framework.

With Union Budget 2026 scheduled for February 1, 2026, these proposals reflect growing expectations for a simpler, fairer and more taxpayer-friendly tax system.