Union Budget 2026-27: From morning coffee to evening drink - what gets cheaper, what gets costlier

NEW DELHI: Last year, the salaried class cheered, this time it's producers' turn to clink glasses. From morning coffee to stock market trades, the Union Budget 2026–27 quietly redrew the household balance sheet, making some crucial drugs cheaper, while nudging others up, as Union finance minister Nirmala Sitharaman chose long-term industrial muscle over instant consumer relief amid global trade jitters.As the economists termed it a "producer-centric" budget, they expressed optimism that it would give Make in India a positive push. For middle class, it may look disappointing on paper, but experts believe that "indirect benefits are greater than direct benefits".

The Budget proposals draw a clear line between items that may turn cheaper for consumers and sectors that could feel the pinch. On the relief side, the government has moved to lower costs for sports equipment, leather goods, cancer medicines and seafood through policy support, duty-free imports and customs exemptions, aiming to boost domestic sectors and ease the burden on patients and producers.

In contrast, trading activity and certain corporate cash-distribution routes are likely to become costlier following proposed changes to buyback taxation, the securities transaction tax (STT) and tax collected at source (TCS), signalling a tougher stance on tax arbitrage and compliance. Moreover, imported coffee and alcohol may also get costlier.

Products that may get cheaper:

TL;DR: Sports equipment: Sitharaman proposed the launch of 'Khelo India Mission' which would focus on employment, skilling and job opportunities in the world of sports.

• Sports equipment: Sitharaman proposed the launch of 'Khelo India Mission' which would focus on employment, skilling and job opportunities in the world of sports. With this, sports equipment are expected to get better. "The Sports Sector provides multiple means of employment, skilling and job opportunities. Taking forward the systematic nurturing of sports talent which is set in motion through the Khelo India programme, I propose to launch a Khelo India Mission to transform the Sports sector over the next decade," she said.
• Leather goods: The finance minister announced duty-free imports of specific inputs currently available for exports of leather. "I also propose to allow duty-free imports of specified inputs which is currently available for exports of leather or synthetic footwear to exports of shoe uppers as well," she said.
• Cancer medicines: Sitharaman announced customs duty exemption on 17 cancer medicines and added 7 rare diseases for relief for patients. "To provide relief to patients, particularly those suffering from cancer, I propose to exempt basic customs duty on 17 drugs or medicines. I propose also to add 7 more rare diseases for the purposes of exempting import duties on personal import of drugs, medicines and food for special medical purposes used in their treatment," she said.
• Sea food: Centre announced duty-free fish catch beyond territorial waters to support the fishermen community.
• Microwave ovens: Government announced exemption from basic customs duty on specified parts used in the manufacture of microwave ovens.
• Solar panels: In the energy sector, the government has extended the basic customs duty exemption on capital goods used to manufacture lithium-ion battery cells, and has also removed basic customs duty on the import of sodium antimonate used in making solar glass. Thus, solar panels may get cheaper.
• EV batteries: The government announced that it would continue to waive import duty on machinery used to make lithium-ion battery cells meant for energy storage systems, helping reduce manufacturing costs and boost domestic battery production.
• Personal use imports: In an effort to enhance ease of living, Centre announced that the import duty on all dutiable goods brought in for personal use will be cut from 20% to 10%.
• Travelling abroad: The tax collected at source on overseas tour packages has been cut to 2% from the earlier rates of 5% and 20%, with no minimum amount limit. This means means travellers will have to pay less money upfront when booking foreign trips.
• Cost of sending money abroad for education and treatment: TCS on money sent abroad for education and medical treatment under the (Liberalised Remittance Scheme) LRS has also been reduced from 5% to 2%. Cutting TCS under the LRS for education and medical expenses to 2% reduces the immediate cash outgo for families sending money abroad for studies or treatment.
• Other things include components or parts, including engines of aircraft, goods imported for nuclear power projects, capital goods for critical minerals.

What may get costlier:

TL;DR: Video games manufacturing: The government will withdraw the customs duty exemption on parts used to make video games starting April 1.

• Trading: Trading and some corporate cash-distribution channels may get more expensive as the government proposed changes to buyback taxation, the securities transaction tax (STT), and tax collected at source (TCS) on selected goods—underscoring a stronger drive to limit tax arbitrage and tighten compliance.
• Video games manufacturing: The government will withdraw the customs duty exemption on parts used to make video games starting April 1. As a result, video game consoles or locally assembled gaming devices may become slightly more expensive.
• Misreporting taxes: The Budget proposes to extend immunity from penalty and prosecution to cases of misreporting as well, provided the taxpayer pays the full tax due along with interest and an additional amount equal to 100% of the tax.
• Coffee: The government has removed customs duty exemptions on coffee roasting, brewing and vending machines from February 2. This is likely to make imported coffee machines more expensive, increasing costs for cafés, offices and businesses that rely on such equipment, unless manufacturers or importers absorb the higher duty.
• Imported alcohol: Government proposed that TCS rate for sellers on alcoholic liquor will be rationalised to 2%. Currently TCS rate on sale of alcoholic liquor for human consumption is 1%
• Imported Zoo animals & birds: The government has decided to withdraw the exemption for animals and birds imported by zoos.
• Fertilisers: The government has withdrawn the customs duty exemption on naphtha used in fertiliser production.
• Other goods that may get costlier include Umbrellas, ATM/cash dispenser machine and its parts and component, film & broadcasting equipment for foreign crews.

A producer-centric budget?

"The budget clearly tilts toward strengthening industry and supply chains rather than immediate consumer relief," said economics professor Vinod Sen, Indira Gandhi National Tribal University, Amarkantak.

"The government’s belief is that strong supply-side growth will eventually benefit consumers through trickle-down effects, though the immediate emphasis remains on production and competitiveness," he added.Unlike last year when the Budget offered massive tax relief to the salaried class, this time, it remained "more producer-centric Budget, with initiatives such as dedicated rare-earth corridors and increased growth and budgetary support for manufacturing, defence, and infrastructure (record Rs 12.5 lakh crore capital expenditure)," said Raksha Singh, economics professor, IGNTU.

What's there for middle class?

"Middle-income households receive selective relief, though the overall impact is modest," Sen said."The Union Budget 2026–27 prioritizes industrial growth and long-term competitiveness over immediate consumer or middle-class relief. Its benefits will unfold gradually through stronger manufacturing, supply chains, and employment opportunities. This approach aligns with the government’s Viksit Bharat @2047 vision but demands consistent execution and favorable global trade conditions," he added.The cheaper and the dearer list offers little for the middle class. Major relief in cancer medication prices, along with relief in appliances seem to be a few reliefs here and there.However, experts believe that it may prove beneficial in the longer run as it would "generate employment opportunities over time"."For the middle class, indirect benefits are greater than direct benefits, as the Budget is based on structural economic growth rather than immediate consumption growth, which is expected to generate employment opportunities over time.

As we all expect every time tax exemptions and tax benefits, so in that front, no change," Singh said.

A Make in India push?

The Budget has attempted to sharpen the Make in India and Atmanirbhar Bharat push by ringfencing manufacturing-heavy, strategic sectors for scale-up and import substitution. The government targeted frontier areas such as biopharma and biosimilars, semiconductors and electronics components, rare earth magnets, chemicals, capital goods and construction equipment, container manufacturing, and clean energy—including EV batteries, solar glass and nuclear power. "The budget provides meaningful but long-term support for domestic manufacturing in the face of global trade challenges," said Sen, adding that "Semiconductor Mission 2.0, capital goods expansion, and duty exemptions on equipment for lithium-ion cells and critical minerals strengthen local production." "These steps reduce reliance on imports and shield India from tariff shocks," he said.Singh, however, said that the self-reliance depended on "proper implementation" of the schemes."Make in India push is slow and strategic, and it can be achieved if properly implemented. Reduced input costs and improved MSME financing will provide a push; however, innovation faces challenges due to relatively less emphasis on R&D, and the focus appears to be more on 'assemble in India' rather than 'Make in India'," Singh said."However, from another angle, this can be seen as a smart move to give an immediate push to industries and generate employment opportunities, with the expectation of gradually shifting towards indigenous manufacturing over time," she added.