Income Tax Budget 2026 highlights: Does Budget 2026 impact tax slabs, what are new rules?

INcome assess Budget 2026 highlights: as well announcing how the young Income assess move will impact people from April 1, Union finance minister Nirmala Sitharaman also extended the deadline for filing IT returns, while speaking on Union Budget 2026-27.However, no changes were introduced in the tax structure or slabs in this year's budget.Last year, in the Union Budget 2025, taxpayers received substantial relief in tax slabs.The tax structure under the new tax regime is as follows:- 0-4 lakh rupees - Nil- 4-8 lakh rupees - 5%- 8-12 lakh rupees - 10%- 12-16 lakh rupees - 15%- 16-20 lakh rupees - 20%- 20-24 lakh rupees - 25%- Above 24 lakh rupees - 30%What is the new Income Tax Act, 2025?The Income Tax Act, 2025, introduces no change in the tax slab rates. It simplifies direct taxes, removing ambiguities and thus reducing the scope of legal actions.The new law also has a streamlined tax structure, with the total number of sections reduced from 819 to 536, the total number of chapters cut from 47 to 23, 16 schedules included, and new tools -- tables and formulas -- introduced for clarity and ease of interpretation.The new I-T Act has four core objectives:1. Simplification: Replace obsolete language and redundant provisions with clear, concise, and modern legal text.2. Digital interpretation: Allow faceless assessments and digital compliance to reduce corruption and human interface.3. Taxpayer-centric approach: Enhance transparency, improve ease of filing and reduce litigation.4. Global alignment: Reflect contemporary economic realities, including taxation of digital assets and global income.Budget 2026-27In her 81-minute Budget 2026 speech, Nirmala Sitharaman touched upon some important issues: time of Income Tax return filing, hike in Securities Transaction Tax (STT) on Futures and Options, expansion of India's semiconductor mission, and the rare earth corridors.What is a buyback?According to the Central Board of Direct Taxes (CBDT), a “buy-back” means the purchase by a company of its own shares in accordance with the provisions of company law.In simple terms, a buyback is when a company offers to purchase its own shares from shareholders and then cancels those shares. This reduces the total number of shares in the market, which can increase earnings per share and the promoter’s stake in the company.How will buyback tax be calculated now?Under the new system, buyback gains will be taxed like normal capital gains. The I-T department said, “Shareholders other than promoters will pay tax on such gains at the applicable capital gains tax rate. That is 12.5% for long term capital gains, listed and unlisted. 20% on short term listed, and applicable rate on short term unlisted.”The calculation will be simple:Buyback price – Cost of acquisition = Capital gainsFor example, if a shareholder bought a share for ₹100 and sold it in a buyback for ₹150, the taxable gain will be ₹50.If the share was held for more than 12 months, the gain will be taxed at 12.5% (long-term capital gains).If held for less than 12 months, it will be taxed at 20% (short-term capital gains).This is lower than dividend taxation, which could go up to 30% depending on the income slab.