Parliament approves Finance Bill 2025, completes Budget FY26 exercise

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The Rajya Sabha on Thursday returned the Finance Bill 2025 to the Lok Sabha, along with 35 government amendments, including one that abolishes a 6 per cent digital tax on online advertisements, thus completing the 2025-26 budgetary exercise that started on February 1.

The House also returned the Appropriation Bill (3) with a voice vote.

Earlier in the day, Finance Minister Nirmala Sitharaman had moved the two bills in the House.

The Lok Sabha had passed the Finance Bill on March 25 and passed the Appropriation Bill on March 21. 

Replying to the debate later in the evening, she said the tendency of the finance ministry would be to exercise caution and not let go of revenues.

"But, here we wanted to use this opportunity to show our respect for Indian taxpayer. We have moved towards setting Rs 12 lakh as threshold up to which no one will have to pay any tax," Sitharaman said.

The Union Budget 2025-26 envisages a total expenditure of Rs 50.65 trillion, an increase of 7.4 per cent over the current fiscal.

The total capital expenditure proposed for the next fiscal is Rs 11.22 trillion and an effective capital expenditure of Rs 15.48 trillion.

It proposes a gross tax revenue collection of Rs 42.70 trillion and a gross borrowing of Rs 14.01 trillion.

According to Budget documents, Rs 5,41,850.21 crore has been earmarked for Centrally Sponsored Schemes for the financial year starting April 1, 2025. This compares with Rs 4,15,356.25 crore for the current financial year.

For central sector schemes, Rs 16.29 trillion have been earmarked for FY26 compared to Rs 15.13 trillion for 2024-25.

Budget estimates of expenditure for 2025-26 have increased due to several reasons, including a rise in payment of interest on market loans, treasury bills, external loans, small savings and provident funds; higher requirements of Armed Forces, including capital expenditure; and more provisions for employment generation scheme.

Total resources being transferred to states, including devolution of states' share, grants/loans and releases under Centrally Sponsored Schemes, in Budget 2025-26 are Rs 25,01,284 crore, a rise of Rs 4,91,668 crore over the actuals of 2023-24.

The fiscal deficit for FY26 is projected at 4.4 per cent against 4.8 per cent in the current fiscal.

The GDP for FY2025-26 is estimated at Rs 3,56,97,923 crore, which is 10.1 per cent over the Revised Estimates for FY2024-25 of Rs 3,24,11,406 crore released by the National Statistical Office(NSO).