Budget 2026 middle-class taxpayers got no income tax relief, unchanged tax slabs, and zero additional deductions despite rising inflation, healthcare costs, and education expenses.
We’d been reading articles, watching news debates, calculating possibilities – maybe they’d increase the standard deduction or give some relief on healthcare costs.
That hope lasted about fifteen minutes into the budget speech.
The reality hit hard when we realized the tax slabs weren’t changing. Not even a little bit. After last year’s sweet relief, where they made income up to 12 lakh rupees tax-free, we thought this year would continue that momentum. Wrong assumption on our part.
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Table of Contents:
- No Tax Relief Despite High Expectations
- Tax Slabs Frozen While Everything Costs More
- Healthcare Expenses Still Breaking Families
- Education Costs Without Any Support
- Housing Becoming Harder to Afford
- Inflation Eating Whatever’s Left
- Senior Citizens Completely Ignored
- What Budget 2026 Actually Gave Us
- Questions People Are Asking
Budget 2026: No Tax Relief Despite High Expectations
The biggest letdown in Budget 2026 middle class expectations was the complete absence of tax rate changes. Both old and new tax regimes stayed exactly the same.
When nothing changed, he literally had to redo his entire budget for the year.
The government essentially told us that what we gave you last year should be enough. But inflation didn’t freeze. School fees didn’t stop rising. Medical costs kept climbing. Just because tax slabs stayed the same doesn’t mean our financial pressure did.
I spoke with a CA who said his office got flooded with calls after the budget. People were confused, some angry, most just disappointed. They’d been mentally preparing for tax savings that never came.
Budget 2026 Tax Slabs Frozen While Everything Costs More
Same structure as 2025. Same as before that, if we’re being honest.
I’m not saying these rates are terrible by themselves. But when you’re earning maybe 1 lakh per month, paying taxes above that threshold, and then your apartment rent increases, your kid’s school announces a fee hike, groceries get costlier – you start realizing your actual buying power is shrinking even if your salary increased nominally.
My sister calculated that her salary went up 7% this year. Sounds good until she factored in inflation and unchanged tax rates. She’s actually able to afford less than she could last year. That stings.
The government did make some process changes – extended deadlines for filing revised returns, reduced TCS rates on foreign education and travel from 5% to 2%. That’s helpful in specific situations, I guess. But it’s not putting extra money in regular folks’ pockets month after month.
Budget 2026 Healthcare Expenses Still Breaking Families
This one really gets under my skin. Out-of-pocket healthcare spending in India is close to 48% of total healthcare costs. That’s ridiculously high.
With how expensive medical treatment has become, these limits feel ancient. My uncle had bypass surgery last year – the bill came to 3.5 lakh even after insurance covered its part. Various exclusions and sub-limits meant he paid nearly 40% out of pocket.
It talked about healthcare infrastructure, manufacturing, and bio-pharma investments. All good for the future, maybe, but what about families dealing with medical emergencies right now?
Some experts thought they might expand Ayushman Bharat or reduce the senior citizen age limit. None of that happened. The only minor positive was exempting customs duty on 17 cancer drugs, which genuinely helps those specific patients. But for regular medical expenses, hitting every family? Nothing.
Budget 2026 Education Costs Without Any Support
Got kids? Then you know education costs are absolutely crazy. School fees, coaching classes, college admissions, books, uniforms – it never stops adding up.
Middle-income families now spend roughly 55% of their monthly income on basic needs compared to 45% a decade back. Education is a massive part of that jump.
Nothing happened there either.
The only small benefit was reducing TCS on money sent abroad for education from 5% to 2%. So if you’re wealthy enough to send kids overseas for studies, you’ll pay less upfront tax that gets refunded later. But for 99% of us, sending children to Indian schools and colleges? Zero help.
They did mention increased allocation to government schools and digital education infrastructure. That’s thinking long-term about future generations. But it doesn’t reduce the burden on parents paying fees today, this month, right now.
Budget 2026 Housing Becoming Harder to Afford
Real estate prices in cities keep rising, home loan interest rates are still relatively high, and EMIs take a huge chunk of the monthly salary.
In Budget 2026, middle-class taxpayers were hoping for increased limits on home loan interest deductions. Right now, you can claim up to 2 lakh under Section 24b for a self-occupied property. That limit was set years ago when property prices were maybe half of current rates.
I know people who bought 2BHK apartments in suburbs – not even prime locations – and their EMIs are 45,000 to 50,000 per month. The interest portion alone crosses 2 lakh annually, but they can only claim that much on their taxes.
The budget mentioned 12.2 lakh crore for capital expenditure and infrastructure, which theoretically helps development. There were schemes like PMAY mentioned for affordable housing. But immediate, direct relief for people already drowning in home loan payments? Missing completely.
Urban housing is one of the biggest financial burdens middle-class families face, and this budget basically acknowledged it exists but offered no actual help.
Budget 2026 Inflation Eating Whatever’s Left
Food prices, fuel costs, cooking gas – everything’s expensive and getting worse. The budget reduced customs duty on personal imports from 20% to 10%, which is nice if you shop internationally. They exempted duty on 17 cancer drugs too, genuinely helpful for those patients.
But what about everyday inflation hitting everyone? Tomatoes, onions, cooking oil, milk, and chicken – basics are costing way more than six months ago. When there’s no tax relief, no increase in deductions, no direct help managing daily expenses, families get squeezed from every direction.
People were hoping for GST adjustments on essential items or a reduction in fuel taxes. Budget didn’t touch any of that. The focus was manufacturing, infrastructure, defense – important for the economy, sure, but doesn’t help my grocery bill.
Budget 2026 Senior Citizens Completely Ignored
Under the new tax regime, seniors get the same basic exemption as everyone else. No additional benefit despite their higher healthcare needs. Experts suggested raising exemption limits specifically for seniors or allowing bigger medical deductions beyond Section 80D.
Didn’t happen.
Pensioners were hoping for tax parity – treating pensions more like how other income gets taxed, maybe with a decent standard deduction. That didn’t happen either.
My father’s retired, living on a pension plus some savings. He was reading articles saying this budget might finally recognize senior citizens’ unique situation. Instead, it was business as usual. Same treatment as everyone else, despite having completely different financial needs.
What Budget 2026 Actually Gave Us
Okay, being fair here, it wasn’t all terrible. Some changes happened, just not what we wanted.
More time to fix mistakes, which is useful. Different deadlines for different ITR forms too – ITR-1 and ITR-2 remain July 31, but non-audit business cases get until August 31.
TCS on overseas spending for education, medical treatment, and travel dropped from 5% to 2%. Actually helpful if you’re sending money abroad. You’re not paying less tax total, just less upfront that gets refunded eventually.
Some TDS simplifications and an automated process for getting lower TDS certificates. Useful for people dealing with that stuff, but most salaried folks won’t notice.
Budget 2026: The Market Showed Real Sentiment
Social media went crazy with memes, mostly using movie references, showing disappointment. There was this whole trend using scenes from different films – I saw probably fifty versions. People were coping with humor because what else can you do, really?
Budget 2026 Looking Forward Honestly
Here’s what worries me going ahead. The middle class is the backbone of consumption in India. We’re the ones buying cars, appliances, going on occasional vacations, sending kids to college, taking loans, and investing in mutual funds. When we feel financially squeezed, it affects the whole economy.
Some economists say the government probably felt it had already stretched the fiscal budget with last year’s relief. Fair enough, maybe. But there’s a difference between massive tax overhauls and targeted relief for specific problems.
Instead, the message we got was basically: Be happy with last year’s relief and focus on process simplification.
Maybe next year. Or the year after. We’ll keep hoping.
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Budget 2026 Questions People Are Asking
Are senior citizens getting any special benefits?
No. Senior citizens continue getting the same basic exemption limit as other taxpayers under the new regime, with no additional benefits despite typically higher healthcare costs. This was a major disappointment for retired people.
Did Budget 2026 help with education expenses?
Very minimally. The TCS on money sent abroad for education dropped from 5% to 2%, helping families send children overseas. But for the vast majority paying for education in India, there were no increases in deduction limits or new benefits.
Should middle-class taxpayers expect relief in future budgets?
That’s uncertain. Some economists believe the government has limited fiscal space after last year’s tax relief. Others argue targeted measures for healthcare and education could still be introduced without a major fiscal impact. Only time will tell.