The 8th budget of Finance Minister Nirmala Siddaraman outlines a number of measures proposed to increase growth by increasing consumption.
Despite the high economic growth, the budget amount was reduced from 14.7 percent in 2024-25 to 14.2 per cent in GDP in 2025-26. By 2024-25, the central government’s government’s revenue costs from Rs 47,16,487 crore from Rs 47,16,487 crore to 2025-26, from Rs 47,16,487 crore at Rs 47,16,487 crore, from Rs 47,16,487 crore.
However, in 2024-25, there is a complete reduction in revenue costs from 48 48,20,512 crore to 2024-25 (-2.2 per cent). This is clearly clear from 11.3 per cent to 11.3 per cent to 11 per cent from 2024-25 in 2024-25.
Capex Dip
The budget said it was an increase in infrastructure growth. But in 2024-25, the total cost of capitalization is from 3.4 percent of GDP (BE) in 2025-26 to 3.1 percent of GDP.
Although the central government has proposed to increase the transfers on the Central Funding Scheme (CSS) to 5,41,850 crore in 2025-26, the CSS transfers from 2024-25 to 2024-25 to 17.9 per cent. This reduction is also mentioned in the allocation of funds for MNREGA, which is the same for 2024-25 re and 2025-26 BE.
Similarly, financial commission subsidies declined from 32 1,32,378 crore by 2024-25, but 2024-25 re-₹ 1,27,146 crore. In 2025-26, the financial deficit was reduced from 4.8 percent of 2024-25 Re to 4.4 per cent, which is a sign of positive financial coordination.
These changes indicate a change in the economic strategy of the government, focusing on the increase in consumption while maintaining financial wisdom. However, a decrease in both capital and revenue costs may raise concerns over economic growth and growth.
Income page
In the revenue side, in 2024-25, revenue receipts from 31,29,200 crore decreases from 8 30,87,961 crore in 2024-25. Revenue receipt declined from 13 percent to 2024-25 in 2023-24.
During the same period, the corporate tax collection is 11.2 percent to 10 per cent.
Also, the duties of customs and union excise do not improve much. Goods and Services Tax (GST) revenue growth is identical, 10.9 percent for both periods. GST compensatory chess states have no indication of exchange to meet their financial needs in the budget presentation, although the central government is expected to charge Rs 3 1.53 lakh crore.
The share of the states in the line has declined from 12.8 percent to 11.6 per cent from 12.8 percent of 2024-25 RE. The tax share for the states is the same – 30.1 per cent – 41 per cent instead of devolution of power. This slope of tax share can have serious impact on the development of states.
Non-tax reduction in 2024-25, from 4 5,45,701 crore to 2024-25, 3 5,31,000 crores, which is a major decline in non-tax revenue from 32 per cent. Up to.
The government has not taken any action to increase the non -tax revenue collection, and in additional resource mobilization.
In these circumstances, it is a matter of concern to reduce the deficit from 4.8 percent to 2024-25 in 2024-25 to 4.4 per cent in 2025-26. Also, reducing subsidies, especially fertilizer and food subsidies, may have impacts on various sectors.
Leverage Direct Investment, Welcome
The gravity of foreign direct investment (foreign direct investment) is a welcome step for increasing and growth. However, 100 percent FDI in the health insurance industry and its impact on the economy.
Budget allocation for primary internship projects will be 2024-25 re.
A trusted announcement in this budget is to provide identity cards and health insurance for Kick workers, which is very commendable, which will be a motivation for informal sector workers.
That is relief
Most importantly, the announcement that there is no income tax on M 12 lakh is in fact a welcome move to taxpayers. However, the budget savings habit has been completely ignored by avoiding claims such as House Loan interest, the primary fee of the loan, the future deposit fund, the NPS savings and the health insurance. This affects the compulsory storage of individuals who further reduce investment.
However, the budget’s silence is also concerned in raising additional revenue to compensate for the loss of ₹ 1 lakh crore. In a nutshell, no specific plans have been announced in the budget for employment creation, controlling inflation and reducing the inequalities in the economy.
Sumalata Assistant Professor, and; Anita Kumari is a teacher at the Finance and Taxation Institute, Thiruvananthapuram
