[November, 2025] -> State Finances 2022-23 Audit Report Released: The CAG released a comprehensive report revealing that states’ total debt stood at 22.17% of GDP, breaching the FRBM target of 20%. All 28 states recorded fiscal deficits, highlighting significant gaps in revenue capacity and fiscal prudence.
[November, 2025] -> GST Council Approves Next-Gen GST 2.0 Reform: The 56th GST Council meeting approved a simplified two-tier tax structure (5% and 18%) and a 40% de-merit rate for sin goods. This reform eliminates the 12% and 28% slabs to reduce classification disputes and boost consumption,.
[October, 2025] -> End of GST Compensation Cess and State Fiscal Space: The abolition of the GST compensation cess in July 2025 triggered demands from states for a larger share of the divisible tax pool. States raised concerns over the Centre’s reliance on non-shareable cesses, which has shrunk the divisible pool from 88.6% to 78.9%,.
[October, 2025] -> Nutrient Based Subsidy (NBS) Rates for Rabi 2025-26: The Cabinet approved NBS rates for Phosphatic and Potassic fertilizers to ensure affordable availability to farmers. The scheme provides a fixed subsidy per kg of nutrient (N, P, K, S) to promote balanced soil nutrition,.
[September, 2025] -> Income Tax Act 2025 Receives Presidential Assent: The new Act replaces the Income Tax Act of 1961, reducing sections from 819 to 536 to simplify the direct tax regime. It formally introduces the concept of a ‘Tax Year’ and streamlines provisions for digital transactions and tax deductions,.
[July, 2025] -> Debate on Rationalising Food and Fertiliser Subsidies: With extreme poverty declining to 5.3%, policymakers discussed restructuring the ₹2.03 lakh crore food subsidy and ₹1.56 lakh crore fertiliser subsidy. Proposals include shifting to digital food coupons and deregulating fertiliser prices to improve fiscal efficiency,.
[June, 2025] -> 16th Finance Commission and Devolution Challenges: The 16th Finance Commission faces the task of addressing the vertical fiscal imbalance, as states demand an increase in the devolution share beyond 41%. The commission will examine the impact of cesses and surcharges on state revenues for the 2026-31 award period,.
[February, 2025] -> Fiscal Anchor Shift to Debt-to-GDP Ratio: The Union Government announced a strategic shift from using fiscal deficit to the Debt-to-GDP ratio as the primary fiscal anchor starting FY 2026-27. The target is to reduce the ratio to 50% by 2031 to ensure long-term sustainability.
[February, 2025] -> Union Budget 2025-26: Fiscal Deficit Targeted at 4.4%: The budget accelerated fiscal consolidation by reducing the fiscal deficit target to 4.4% of GDP from 4.8%. It also increased capital expenditure by 10% to ₹11.21 lakh crore and raised the income tax exemption limit under the new regime,.
[January, 2025] -> Launch of Fiscal Health Index (FHI) 2025: NITI Aayog released the FHI 2025 to evaluate the fiscal performance of 18 major states. The index tracks metrics like quality of expenditure, revenue mobilization, and debt sustainability to encourage fiscal prudence among states.
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India Fiscal Policy and Budget ▼
[November, 2025] -> State Finances 2022-23 Audit Report Released: The CAG released a comprehensive report revealing that states’ total debt stood at 22.17% of GDP, breaching the FRBM target of 20%. All 28 states recorded fiscal deficits, highlighting significant gaps in revenue capacity and fiscal prudence.
[November, 2025] -> GST Council Approves Next-Gen GST 2.0 Reform: The 56th GST Council meeting approved a simplified two-tier tax structure (5% and 18%) and a 40% de-merit rate for sin goods. This reform eliminates the 12% and 28% slabs to reduce classification disputes and boost consumption,.
[October, 2025] -> End of GST Compensation Cess and State Fiscal Space: The abolition of the GST compensation cess in July 2025 triggered demands from states for a larger share of the divisible tax pool. States raised concerns over the Centre’s reliance on non-shareable cesses, which has shrunk the divisible pool from 88.6% to 78.9%,.
[October, 2025] -> Nutrient Based Subsidy (NBS) Rates for Rabi 2025-26: The Cabinet approved NBS rates for Phosphatic and Potassic fertilizers to ensure affordable availability to farmers. The scheme provides a fixed subsidy per kg of nutrient (N, P, K, S) to promote balanced soil nutrition,.
[September, 2025] -> Income Tax Act 2025 Receives Presidential Assent: The new Act replaces the Income Tax Act of 1961, reducing sections from 819 to 536 to simplify the direct tax regime. It formally introduces the concept of a ‘Tax Year’ and streamlines provisions for digital transactions and tax deductions,.
[July, 2025] -> Debate on Rationalising Food and Fertiliser Subsidies: With extreme poverty declining to 5.3%, policymakers discussed restructuring the ₹2.03 lakh crore food subsidy and ₹1.56 lakh crore fertiliser subsidy. Proposals include shifting to digital food coupons and deregulating fertiliser prices to improve fiscal efficiency,.
[June, 2025] -> 16th Finance Commission and Devolution Challenges: The 16th Finance Commission faces the task of addressing the vertical fiscal imbalance, as states demand an increase in the devolution share beyond 41%. The commission will examine the impact of cesses and surcharges on state revenues for the 2026-31 award period,.
[February, 2025] -> Fiscal Anchor Shift to Debt-to-GDP Ratio: The Union Government announced a strategic shift from using fiscal deficit to the Debt-to-GDP ratio as the primary fiscal anchor starting FY 2026-27. The target is to reduce the ratio to 50% by 2031 to ensure long-term sustainability.
[February, 2025] -> Union Budget 2025-26: Fiscal Deficit Targeted at 4.4%: The budget accelerated fiscal consolidation by reducing the fiscal deficit target to 4.4% of GDP from 4.8%. It also increased capital expenditure by 10% to ₹11.21 lakh crore and raised the income tax exemption limit under the new regime,.
[January, 2025] -> Launch of Fiscal Health Index (FHI) 2025: NITI Aayog released the FHI 2025 to evaluate the fiscal performance of 18 major states. The index tracks metrics like quality of expenditure, revenue mobilization, and debt sustainability to encourage fiscal prudence among states.
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