New Delhi: Foreign travel is set to become more affordable for Indians following proposals in the Union Budget 2026-27 presented Sunday by Finance Minister Nirmala Sitharaman.

She announced a reduction in the Tax Collected at Source (TCS) on overseas tour packages from the current 5% and 20% to 2%, with no minimum purchase required.

TCS works opposite to tax deducted at source (TDS). The seller collects tax from the buyer at the time of sale and deposits it with the government. For example, when purchasing high-value goods or spending abroad, the seller or bank collects a small percentage as tax. The amount is not an extra cost, as it is adjusted when filing income tax returns. The government uses TCS primarily to track high-value spending and ensure proper reporting of income.

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Budget 2026-27 focuses on Growth and Infrastructure

The budget, driven by "Yuvashakti" and based on three kartavyas, includes a push for infrastructure and sustainable development. Sitharaman proposed seven high-speed rail corridors, new dedicated freight corridors, and the operationalization of 20 national waterways over the next five years.

"The Union Budget 2026-27 is aimed at accelerating economic growth, supporting regional development, and promoting environmentally sustainable passenger systems," Sitharaman said.

The corridors are designed to reduce travel time, cut emissions, and connect India's major economic and urban hubs. Routes include:

• Mumbai-Pune
• Pune-Hyderabad
• Hyderabad-Bengaluru
• Hyderabad-Chennai
• Chennai-Bengaluru
• Delhi-Varanasi
• Varanasi-Siliguri