Union Budget 2026: A comprehensive blueprint detailing the government's projected income and expenditure for a fiscal year, the Union Budget spans from April 1 to March 31 of the following year. This financial roadmap plays a crucial role in outlining the nation's economic priorities and resource allocations.
To enhance accessibility and understanding, a user-friendly guide for interpreting the Budget document is readily available. Following the finance minister's budget speech in the Lok Sabha, these critical documents are swiftly published on the official website, ensuring rapid and widespread dissemination of essential financial information.
The upcoming Budget scheduled for February 2026 will be Prime Minister Narendra Modi-led government's third full budget and fourth budget after returning to power in Lok Sabha polls. The first Budget of Modi 3.0 was a vote on account.
In the last Budget, the Finance Minister informed that for the year 2025-26, the total receipts other than borrowings is Rs 31.47 lakh crore, of which the net tax receipts were at Rs 25.57 lakh crore.
The fiscal deficit for FY25 is projected at 4.8% of GDP, with a target of 4.4% for FY26.
The government’s gross borrowing target for FY26 was revised upwards 5.7% to Rs 14.82 lakh crore. Earlier, it was set at Rs 14.01 lakh crore for FY25.
Part A of the speech outlines the finance minister's expectations and presents the reform direction envisioned for the forthcoming financial year.
Part A
This includes a variety of planned initiatives and strategies aimed at benefiting various sectors, including farmers, the rural community, healthcare, education, small and large enterprises, the service industry, women, startups, banking and financial services, capital markets, infrastructure, and other areas. Additionally, the finance minister outlines specific targets outlined in the budget, such as divestment, fiscal deficit, and the extent to which the government intends to borrow from bond markets, among other key aspects.
The last Budget in July 2025 was focused on employment, skilling, MSMEs, farmers and the middle class. Sitharaman announced six new agricultural schemes while increasing the subsidised Kisan Credit Card loan limit to Rs 5 lakh from the existing Rs 3 lakh, benefiting 7.7 crore farmers, fishermen, and dairy farmers. The Ministry of Education was allocated Rs 1,28,650 crore.
Part B
Next comes Part B of the budget speech that primarily focuses on various taxes, encompassing both direct and indirect taxes, except for GST. GST falls outside the budget's scope and is determined by the GST Council.
This section is instrumental in announcing adjustments to income tax slabs, corporate tax, capital gains tax, as well as customs and excise duties.
Sitharaman, during the last budget, announced major tax relief for the middle class with a total tax exemption for income up to Rs 12 lakh per annum.
Here’s the updated tax slabs:
The government also doubled the TDS exemption for senior citizens to Rs 1 lakh and extended the deadline for filing updated returns from two to four years.
Adding to above mentioned objectives, 'Budget at a Glance' document helps an individual understand specific details, including allocations for fuel, fertilizer, and food subsidies. It outlines the planned transfer of the Centre's divisible revenues to states and Union territories, shedding light on the distribution of financial resources.
The document also highlights expenditure on significant schemes, categorizing them into two types: Central sector schemes, fully funded by the Indian government, and centrally sponsored schemes, jointly financed by both the Centre and state governments.
The presentation of the Budget marks the beginning of an extensive process. As a Money Bill, it must first receive approval from the Lok Sabha before being presented to the Rajya Sabha.
Following the Budget's approval, extensive debates take place in both Houses of Parliament. During this process, the Finance Minister is present to address any questions or concerns raised by MPs.
Once approved, the legislation becomes the Finance Bill, which not only formalizes the Budget but also includes amendments to various laws, such as the RBI Act, Income Tax Act, Companies Act, and Banking Regulation Act, in line with the proposed measures. The Finance Bill/Act is what gives the Budget its legal validity.
Full list of Budget documents presented to the Parliament, besides the Finance Minister’s Budget Speech:
To enhance accessibility and understanding, a user-friendly guide for interpreting the Budget document is readily available. Following the finance minister's budget speech in the Lok Sabha, these critical documents are swiftly published on the official website, ensuring rapid and widespread dissemination of essential financial information.
The upcoming Budget scheduled for February 2026 will be Prime Minister Narendra Modi-led government's third full budget and fourth budget after returning to power in Lok Sabha polls. The first Budget of Modi 3.0 was a vote on account.
In the last Budget, the Finance Minister informed that for the year 2025-26, the total receipts other than borrowings is Rs 31.47 lakh crore, of which the net tax receipts were at Rs 25.57 lakh crore.
The fiscal deficit for FY25 is projected at 4.8% of GDP, with a target of 4.4% for FY26.
The government’s gross borrowing target for FY26 was revised upwards 5.7% to Rs 14.82 lakh crore. Earlier, it was set at Rs 14.01 lakh crore for FY25.
Finance Minister's Speech:
The budget presentation starts with Finance Minister's speech, though the delivery might constitutes a small portion of the entire budget documents, it is considered significant.Part A of the speech outlines the finance minister's expectations and presents the reform direction envisioned for the forthcoming financial year.
Part A
This includes a variety of planned initiatives and strategies aimed at benefiting various sectors, including farmers, the rural community, healthcare, education, small and large enterprises, the service industry, women, startups, banking and financial services, capital markets, infrastructure, and other areas. Additionally, the finance minister outlines specific targets outlined in the budget, such as divestment, fiscal deficit, and the extent to which the government intends to borrow from bond markets, among other key aspects.
The last Budget in July 2025 was focused on employment, skilling, MSMEs, farmers and the middle class. Sitharaman announced six new agricultural schemes while increasing the subsidised Kisan Credit Card loan limit to Rs 5 lakh from the existing Rs 3 lakh, benefiting 7.7 crore farmers, fishermen, and dairy farmers. The Ministry of Education was allocated Rs 1,28,650 crore.
Part B
Next comes Part B of the budget speech that primarily focuses on various taxes, encompassing both direct and indirect taxes, except for GST. GST falls outside the budget's scope and is determined by the GST Council.
This section is instrumental in announcing adjustments to income tax slabs, corporate tax, capital gains tax, as well as customs and excise duties.
Sitharaman, during the last budget, announced major tax relief for the middle class with a total tax exemption for income up to Rs 12 lakh per annum.
Here’s the updated tax slabs:
- Rs 0 – Rs 4,00,000: No Tax
- Rs 4,00,001 – Rs 8,00,000: 5%
- Rs 8,00,001 – Rs 12,00,000: 10%
- Rs 12,00,001 – Rs 16,00,000: 15%
- Rs 16,00,001 – Rs 20,00,000: 20%
- Rs 20,00,001 – Rs 24,00,000: 25%
- Above Rs 24,00,000: 30%
The government also doubled the TDS exemption for senior citizens to Rs 1 lakh and extended the deadline for filing updated returns from two to four years.
Budget at Glance
The document provides a comprehensive guide outlining the key budgeted objectives for the upcoming financial year. The essential document includes crucial aspects such as tax revenue, non-tax revenue, government capital and administrative expenditures. Additionally, it presents the targeted fiscal deficit (representing the disparity between the Centre's expenditure and revenue) and the growth objective for the nominal gross domestic product in the forthcoming year.Adding to above mentioned objectives, 'Budget at a Glance' document helps an individual understand specific details, including allocations for fuel, fertilizer, and food subsidies. It outlines the planned transfer of the Centre's divisible revenues to states and Union territories, shedding light on the distribution of financial resources.
The document also highlights expenditure on significant schemes, categorizing them into two types: Central sector schemes, fully funded by the Indian government, and centrally sponsored schemes, jointly financed by both the Centre and state governments.
Revenue and Expenditure Budget
To fully understand the Budget, it’s crucial to refer to the Revenue and Expenditure Budgets, which detail the expected income and planned spending.Revenue Budget
This document provides a breakdown of anticipated income from various sources, such as income tax, corporate tax, GST, excise duty, and non-tax revenues like disinvestment, privatization, telecom, aviation, and other channels.Expenditure Budget
This document outlines the total planned expenditure, categorized by ministry. It offers a detailed view of how the central government allocates funds across different sectors, including defense acquisitions, MGNREGA, PM Kisan, primary education, healthcare, administrative expenses, infrastructure projects, and more.
Finance Bill
The presentation of the Budget marks the beginning of an extensive process. As a Money Bill, it must first receive approval from the Lok Sabha before being presented to the Rajya Sabha.Following the Budget's approval, extensive debates take place in both Houses of Parliament. During this process, the Finance Minister is present to address any questions or concerns raised by MPs.
Once approved, the legislation becomes the Finance Bill, which not only formalizes the Budget but also includes amendments to various laws, such as the RBI Act, Income Tax Act, Companies Act, and Banking Regulation Act, in line with the proposed measures. The Finance Bill/Act is what gives the Budget its legal validity.
Demands for Grants
The request for grants is a format that outlines the expenditure estimates from the Consolidated Fund. These estimates are included in the annual financial statement and require approval through a vote in the Lok Sabha. The demand for grants covers allocations for both revenue and capital expenditures, as well as grants to the governments of States and Union Territories, including loans and advances.Full list of Budget documents presented to the Parliament, besides the Finance Minister’s Budget Speech:
- Annual Financial Statement
- Demands for Grants
- Finance Bill
- Fiscal Policy Statements mandated under FRBM Act
- Macro-Economic Framework Statement
- Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement
- Expenditure Budget
- Receipt Budget
- Expenditure Profile
- Budget at a Glance
- Memorandum Explaining the Provisions in the Finance Bill
- Output Outcome Monitoring Framework
- Key Features of Budget
- Implementation of Budget Announcements
