The Economic Survey released on January 29, 2026 said that significant tax relief for households has already been provided and India’s fiscal deficit is below the set target. A fiscal deficit occurs when the government’s total expenditure exceeds its total revenue from sources like tax, disinvestment, etc (excluding borrowings) during a fiscal year, which shows that the government needs to borrow more to cover the shortfall.
The government sets a target for fiscal deficit, which is the comparison between the money it spends versus what it collects. A deficit denotes that the government is spending more money than it is taking back through collections like tax, bonds, etc), meaning more money is flowing into the economy and to the people.
The Economic Survey said: “The government announced significant tax breaks for households in the budget for fiscal year 2026 (FY26) in February. It achieved a fiscal deficit of 4.8% of GDP, against the budgeted 4.9%, and announced a target of 4.4% for FY26, fulfilling the promise made in 2021 to reduce the Union fiscal deficit by more than half from 9.2% in FY21.”
This wording seems to imply that middle-class taxpayers ought to peg their expectations to current relief measures rather than expecting recurring cuts in tax slabs. Still, experts have differing opinions.
Akhil Chandna, Partner and Global People Solutions Leader, Grant Thornton Bharat, told ET Wealth Online that the Economic Survey 2025-26 suggests that the phase of large, recurring personal tax giveaways is likely behind us.
Chandna says: “With direct-tax buoyancy improving and fiscal consolidation remaining a priority, future budgets are more likely to focus on incremental rationalisation rather than sweeping rate cuts. The emphasis appears to be on preserving stability in the tax framework rather than introducing disruptive relief measures every year.”
Source: The Economic Times
Share this content: