Budget 2026: TCS on education reduced to 2%, says Nirmala Sitharaman

Finance Minister Nirmala Sitharaman presented the Union Budget 2026 today, marking a historic first as India’s budget is being presented on a Sunday for the first time. The speech also marked a significant political milestone, as it was her ninth consecutive budget presented during the tenure of Prime Minister Narendra Modi.

This year's budget places education at the heart of India's growth strategy, signalling a clear intent to strengthen human capital and future-ready skills as key drivers of long-term economic resilience.

The government has expressed its reform agenda, with the Finance Minister stating that over 350 reforms have been rolled out to drive job creation, making this year’s budget strongly focused on Yuva Shakti (youth power).

HIGHLIGHTS:

 

1. The Finance Minister proposed setting up three new National Institutes of Pharmaceutical Education and Research, upgrading seven existing institutes, and creating a network of 1,000 accredited clinical trial centres across India.

2. Nirmala Sitharaman said that ICAI and ICSI will introduce short-term modern courses and expand the Corporate Mitra initiative, with a special focus on Tier-2 and Tier-3 cities.

3. The Finance Minister highlighted a strong focus on women in STEM and youth in technology through new initiatives such as an AI Mission, a National



Research Fund, and an Innovation Fund aimed at building aspirations and strengthening capacities.

4. The AI Mission will support students, while an Education-to-Employment and Entrepreneurship Committee will focus on aligning education with jobs, particularly in the services sector has been proposed.

5. To strengthen skill-career pathways for youth, especially in healthcare, selected higher education institutions will be supported to train one lakh allied health professionals over the coming years.

6. The budget proposes the establishment of new Ayurveda institutes and the creation of content creator labs in schools.

7. The establishment of a new design institute in the eastern region of India has been proposed by Nirmala Sitharaman.

8. The government plans to establish national mental health institutes across India.

9. One girls’ hostel will be established in every district across the country.

10. The government will launch a pilot programme in collaboration with IIMs to train and upskill 10,000 tourist guides across 20 iconic sites through 12-week courses.

11. TCS on education has been reduced to 2%, the Finance Minister said during the Budget speech.

12. Overseas-bound students get a major boost through new foreign education funding schemes.