Home / Business and Economy / Budget 2027: Tax Relief & Capex Boost Expected
Budget 2027: Tax Relief & Capex Boost Expected
31 Jan
Summary
- Personal income tax relief is a top consumer expectation for FY27.
- Fiscal deficit target for FY27 is projected at 4.4% of GDP.
- Government likely to increase capital expenditure in FY27.
The Union Budget for FY27 is set to be presented soon, with high expectations for personal income tax relief and fiscal discipline. Analysts anticipate the government will aim for a fiscal deficit of 4.4% of GDP, maintaining a target that builds on previous achievements. A significant increase in capital expenditure (capex) is also projected, potentially growing by around 13% year-on-year.
Key sectors such as defense, automobiles, agriculture, and MSMEs are in sharp focus due to mounting global trade pressures and the need to stimulate domestic consumption. Specific attention is being given to containing food price inflation, especially for essential items like tomatoes, onions, and potatoes.
Defense allocations are expected to rise, bolstered by the 'Make in India' initiative and recent procurement approvals. The automobile sector will be watched closely following the India-EU Free Trade Agreement. Measures to boost domestic consumption are also anticipated, following prior GST rationalization efforts.
