The Union Budget for 2026-27 tabled by Finance Minister Nirmala Sitharaman in Parliament on Sunday estimates the Gross Tax Revenue (GTR) at Rs 44.04 lakh crore, which represents a growth of 8.0 per cent over the revised estimate (RE) 2025-26.
Direct Taxes, which include corporate tax and personal income tax, estimated at Rs 26.97 lakh crore, are the major contributors, constituting as much as 61.2 per cent of total gross tax revenue. Indirect taxes are estimated at Rs 17.07 lakh crore.
In the Budget Estimate (BE) 2026-27, the GTR to GDP ratio is estimated at 11.2 per cent. The Budget 2026-27 is also the first year of the award period of the Sixteenth Finance Commission (SFC). SFC has recommended retaining the share of devolution to the States at 41 per cent of the divisible pool.
The Tax Revenues (Net to Centre) are projected to be Rs 28.67 lakh crore. In BE 2026-27, the Non-Tax Revenues (NTR) of the Central Government are projected at Rs 6.66 lakh crore. Revenue Receipts of the Union Government [comprising Tax Revenues (Net to Centre) and Non- Tax Revenues (NTR)], are estimated at Rs 35.33 lakh crore.
Revenue Receipt estimates assume a growth of 5.7 per cent over RE 2025-26. The total expenditure of the Central Government in BE 2026-27 is projected to be Rs 53.47 lakh crore (13.6 per cent of GDP), showing a growth of 7.7 per cent over RE 2025-26 of Rs 49.65 lakh crore.
The Budget for FY 2026-27 projects Rs 12.22 lakh crore (3.1 per cent of GDP) towards capital expenditure. This includes capital support to States through Special Assistance as Loan to States for Capital Investment (SASCI) with an outlay of Rs 2.0 lakh crore.
Effective capital expenditure of the Union Government includes the Union Government's capital expenditure and grants-in-aid for the creation of capital assets. Together, they constitute investments that enhance and upgrade the productive capacity of the economy.
In BE 2026-27, the allocation under grants-in-aid for the creation of capital assets is projected at Rs 4.93 lakh crore (or 1.3 per cent of GDP). Thus, the effective capital expenditure in FY 2026-27 is estimated at Rs 17.15 lakh crore (or 4.4 per cent of GDP).