Sat Feb 01 07:28:50 UTC 2025: ## India’s Union Budget Prioritizes Debt Reduction and Tax Revenue
**New Delhi, February 1, 2025** – Finance Minister Nirmala Sitharaman today presented the Union Budget for 2025-26, the second since the NDA’s third consecutive electoral victory. The budget reveals a continued reliance on borrowings and other liabilities, which constitute 24% of the total revenue (down from 27% last year). Income tax contributes the second largest portion at 22% (up from 19% last year), followed by GST and other taxes at 18% (unchanged from last year). Corporation tax accounts for 17%. The remaining revenue comes from non-tax sources, excise duties, customs, and non-debt capital receipts.
Expenditure-wise, the budget allocates 22% (up from 21% last year) to states’ share of taxes and duties. Interest payments consume 20%, followed by 16% for central sector schemes. The Finance Commission and other transfers, defence, and centrally-sponsored schemes each receive approximately 8% of the budget. Subsidies account for 6%, pensions for 4%, and miscellaneous expenditures for the remaining 8%. The budget reflects the government’s focus on fiscal consolidation, with a decrease in reliance on borrowings compared to the previous year.
First Piper 