Finance Minister Nirmala Sitharaman is set to present her ninth Union Budget on 1 February 2026, a milestone moment in her tenure. Since presenting her first budget in July 2019, Sitharaman has consistently focused on simplifying income tax laws, reducing compliance burden, and offering targeted relief to taxpayers. Over the years, these reforms have reshaped India’s tax landscape, improved transparency, and strengthened trust in the system.

As Budget 2026 approaches, here is a clear, year-by-year look at how the tax world has evolved since 2019 under her leadership.

2019: First Budget Focused on Homebuyers and Growth

Nirmala Sitharaman presented her first Union Budget on 5 July 2019, at a time when the economy needed strong momentum. One of the key tax announcements was aimed at homebuyers.

The government introduced an additional deduction of ₹1.5 lakh on interest paid on home loans sanctioned up to 31 March 2020, specifically for affordable housing. This was over and above the existing deduction, taking the total interest deduction limit to ₹3.5 lakh. The move boosted demand in the housing sector and provided meaningful relief to middle-income families.

2020: Introduction of the New Income Tax Regime

Union Budget 2020 marked a major structural change with the launch of the new income tax regime. This alternative system offered lower tax rates but removed most exemptions and deductions.

While the response was initially muted—partly due to the onset of the global health crisis—over time, the new regime gained acceptance. Importantly, the government chose to retain the old tax regime, giving taxpayers flexibility to choose based on their financial situation.

2021: Major Push for Faceless and Digital Tax Administration

In Budget 2021, the focus shifted to tax administration reforms. The finance minister announced faceless assessment and faceless appeal systems, aiming to eliminate personal interaction between taxpayers and tax officials.

Cases began to be allocated electronically, reducing discretion and increasing transparency. These steps played a crucial role in improving taxpayer confidence and reducing disputes.

2022: Cryptocurrency Brought Under the Tax Net

Union Budget 2022 was notable for formally bringing virtual digital assets, including cryptocurrencies, under the tax framework.

The government imposed a 30 percent tax on profits from crypto transactions, along with additional compliance rules. While many investors found the tax rate steep, the move ensured that crypto transactions became traceable and regulated, bringing clarity to an otherwise uncertain area.

2023: New Tax Regime Becomes the Default Option

A major shift came in Budget 2023, when the new income tax regime was declared the default regime.

Under this system, individual taxpayers are automatically taxed under the new regime unless they explicitly opt for the old one. This step simplified decision-making and signalled the government’s confidence in the new structure as the future of income taxation.

2024: Capital Gains Tax Rules Simplified

In 2024, after the interim budget and subsequent full budget presented in July, the finance minister announced significant changes to capital gains taxation.

The government streamlined holding periods and tax rates across asset classes. Short-term capital gains tax was set at 20 percent, while long-term capital gains were taxed at 12.5 percent. These changes addressed long-standing demands for simplification.

Additionally, the standard deduction under the new tax regime was increased to ₹75,000, offering extra relief to salaried taxpayers.

2025: Income Up to ₹12 Lakh Made Tax-Free

The biggest relief for taxpayers came in Union Budget 2025, when Sitharaman announced that annual income up to ₹12 lakh would be exempt from income tax.

For salaried individuals, this effectively meant that income up to ₹12.75 lakh could be earned without paying tax after accounting for standard deductions. Tax slabs under the new regime were also revised, making the system more progressive and middle-class friendly.

Looking Ahead to Budget 2026

As Nirmala Sitharaman prepares to present Budget 2026, expectations are high. Over the past seven years, her budgets have steadily moved toward simpler laws, lower compliance costs, and a technology-driven tax system.

With the upcoming implementation of the Income Tax Act, 2025, Budget 2026 could further cement these reforms and shape the next phase of India’s taxation framework.

From home loan relief and digital reforms to record tax exemptions, the journey since 2019 highlights a clear policy direction—making taxation simpler, fairer, and more transparent for taxpayers.