Ahead Of Budget 2026, 10 Economic Concepts To Know

The Union Budget session of Parliament opened with President Droupadi Murmu delivering her address to the joint sitting of the Lok Sabha and Rajya Sabha in New Delhi.

Finance Minister Nirmala Sitharaman will present the Union Budget 2026 on February 1, a Sunday, a rare instance in India's parliamentary history. The Budget will outline the government's plans for spending, taxation, and economic management for the coming financial year. Ahead of the Budget, the Economic Survey, an assessment of the economy's performance, is expected to be tabled in Parliament on January 29.

The Budget session will run until April 2, with a break in between. The first phase is scheduled from January 28 to February 13, followed by the second phase from March 9 to April 2.

10 Terms To Know Ahead Of Union Budget 2026

Inflation

Inflation refers to a sustained rise in the overall prices of goods and services in the economy. When inflation increases, the purchasing power of money declines. The inflation rate measures how quickly prices are rising over a period of time.

Direct Tax

A direct tax is imposed directly on individuals or entities and cannot be shifted to another party. Income tax and corporate tax are examples.

Indirect Tax

Indirect taxes are levied on goods and services but are ultimately borne by consumers. Examples include excise duty and customs duty.

Fiscal Policy

Fiscal policy includes government decisions on taxation and public spending aimed at managing economic growth, employment, and stability. These choices are reflected directly in the Union Budget.

Monetary Policy

Monetary policy is managed by the Reserve Bank of India (RBI) and focuses on controlling money supply and interest rates to regulate inflation and support economic growth.

Revenue Expenditure

Revenue expenditure is spending that does not result in asset creation or future income. Salaries, pensions, subsidies, and administrative costs fall under this category.

Goods and Services Tax (GST)

GST was introduced to streamline India's indirect tax system by replacing multiple central and state levies with a unified tax structure.

Gross Domestic Product (GDP)

GDP represents the total value of all goods and services produced within a country during a specific period and is a key indicator of economic health.

Fiscal Deficit

A fiscal deficit occurs when the government's total spending exceeds its revenue, excluding borrowings. It indicates the extent to which the government relies on borrowing.

Revenue Deficit

Revenue deficit is the gap between revenue expenditure and revenue receipts. It reflects how much the government's routine expenses exceed its regular income.