Budget 2026 in Simple Language: On hearing the name of the budget, it seems as if a difficult economic class has started. Words like tax, deficit, GDP, capital expenditure confuse the common man. Understand the complete language of the budget here in simple Hindi…
Budget 2026 Words Explained: Every year on the day of budget, the same question circulates on TV, mobile and newspapers, ‘The budget came, but what was said in it?’ Actually budget is not rocket science. The government gives account of only two works. Where will the money come from? And where will the money be spent? On Sunday, February 1, 2026, Finance Minister Nirmala Sitharaman will present the second full budget of Modi government 3.0. It affects your earnings, inflation, taxes, job and savings. But the problem is that there are such words in the budget which confuse the common man. So let us understand the language of budget in simple Hindi.
Revenue Budget
Revenue budget is the account of daily expenditure and daily earnings of the government. That is, money that comes every year and is spent every year. The government’s revenue mainly comes from income tax, GST, corporate tax, fees and fines. Whereas revenue expenditure includes salary of government employees, pension, subsidy, electricity and water expenses and money for running the office. In simple words, the money that comes in and immediately goes away is the revenue budget.
Capital Budget
Capital budget is made keeping the future in mind. In this, the government shows those expenses which create something new or provide long-term benefits. Like new roads, railway lines, hospitals, schools, universities, airports. Besides, it also shows how much loan the government is taking or where it is investing. In simple language, expenditure today, but benefit for many years, this is the capital budget.
GDP (Gross Domestic Product)
GDP tells how much the country produced in total in a year. This includes farming, factory, service, shop, everything. If GDP is increasing, then it is believed that the country’s income is increasing, job opportunities may increase, the government will have more money to spend. GDP is a thermometer of the economic health of the country.
Fiscal Deficit
When the government’s earnings are less and expenditure is more, the difference that remains is the fiscal deficit. Suppose the government’s income is Rs 100 and expenditure is Rs 110, then there will be a fiscal deficit of Rs 10. To meet this shortfall, the government borrows and issues bonds. Higher fiscal deficit means higher debt.
Capital Expenditure
This is the expenditure which increases the wealth of the country. Like new schools, hospitals, highways and railway projects. Its benefits will be available directly in the future. The more capital the government spends, the stronger the economy will be.
Revenue Expenditure
This is the expenditure which does not create anything new, but keeps the government running. Like salary, pension, subsidy, electricity and water expenses. These are all necessary expenses, but do not increase development.
Direct Tax
The tax you pay directly to the government. For example, income tax, corporate tax come under direct tax. It cannot be put on anyone else.
Indirect Tax
Which tax is already included in the price of the goods. Like GST. When you buy goods, tax is automatically deducted. Such tax is called indirect tax.
Income Tax
The tax levied on your annual earnings is called income tax. In the budget, the government can change the tax slab, increase or decrease exemptions. The middle class keeps an eye on this the most.
Corporate Tax
The tax imposed on the profits of companies is called corporate tax. When taxes are reduced, investment increases and jobs are created.
Long Term Capital Gain (LTCG)
If you sold shares, mutual funds or property after a long time and made a profit, then it is called LTCG. Tax is less on this.
Short Term Capital Gain (STCG)
If things like shares, mutual funds or property are sold quickly, the profit that will be made is called STCG. Taxes are also higher when there is quick profit.
Revenue Deficit
If the daily earnings of the government are less than the daily expenditure, then it is called revenue deficit. This means that the government is meeting its expenses by borrowing.
Tax Revenue
Tax revenue is the total amount of money the government gets from taxes. The more tax revenue, the more schemes can be run.
Non-Tax Revenue
The government’s income does not come from taxes alone. Some money also comes in which direct tax is not taken from the common man, this is called non-tax revenue. This includes the profits of government companies, such as money received from companies like ONGC, SBI, LIC. Apart from this, interest on the loan given by the government, passport fees, railway ticket charges, court fees are also included.
Inflation
If something which was cheap earlier, now becomes expensive, then it is called inflation. In inflation there is more demand and less goods. Petrol and diesel are expensive and imports are expensive. If inflation increases, EMIs become heavy, monthly expenses increase and saving becomes difficult. The biggest concern of both the government and RBI is to control inflation.
Fiscal Policy
Fiscal policy means how the government is handling money. It decides whether taxes will increase or decrease, how much the government will spend, how much the deficit will be. In simple words, the government’s ‘money circulation plan’ is fiscal policy.
Monetary Policy
Monetary policy is in the hands of RBI. RBI increases or decreases the interest rate, makes loans cheaper or more expensive Qj controls the quantity of money in the market. If RBI increases the interest, the loan becomes expensive and if it reduces the interest, the loan becomes cheaper.
Excise Duty
There was a time when excise duty was levied on many goods manufactured in India. Now after the introduction of GST, most of the excise has been abolished. At present excise is levied on things like petrol, diesel and liquor.
Cess
Cess is an additional tax, which is imposed for a specific work. Like Swachh Bharat Cess, Education Cess. The special thing is that the states do not get the money from cess, the entire money remains with the central government.
Zero-Based Budget
In this budget, the government does not take old expenditure as the basis. This means that what was spent last time may not necessarily be the same this time too. Every expenditure has to be justified afresh. Its advantage is that useless plans are put to a halt.
Primary Deficit
This shows the actual loss of the government. What is left after deducting the interest on old loans from the fiscal deficit is primary deficit. If it is more, it means the government is not able to meet its expenses even by borrowing.
Current Account Deficit (CAD)
If the country sells (exports) less than what it buys (imports) from outside, then it is called CAD. For example, more oil was imported, but less goods were sold. If CAD is high then rupee will weaken and inflation may increase.
Vote-on-Account
When the budget for the entire year is not passed, the government takes permission for expenditure for a few months. This is called vote-on-account.
Interim Budget
The budget presented before the elections is called interim budget. There are no big announcements or new schemes in this. Its purpose is to ensure that the work of the government continues without any interruption.
Sin Tax
Things which are considered bad for health or society. For example, the heavy tax imposed on liquor, cigarettes and tobacco is called sin tax. It has two objectives, firstly to free people from bad habits and secondly to increase the income of the government.
Dividend Distribution Tax (DDT)
When a company earns profits and gives money to its shareholders, it is taxed. Earlier this tax was paid by the company, now in most cases it is paid by the shareholder.
Banking Cash Transaction Tax (BCTT)
If someone withdraws too much cash from the bank, then the system of imposing tax on it is called BCTT. At present it is not implemented, but remains in discussion to increase digital transactions.
Excess Grant
When the money allocated by the government for any work falls short, then permission for more money has to be taken from the Parliament. This is called access grant i.e. additional grant.
Expenditure Profile
This is that part of the budget, which tells how much money is given to which ministry, how much is spent on which scheme, where the subsidy is going. In simple words it is a report card of government expenditure.
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