Centre Pegs Cess, Surcharge Target at Rs 5.91 Lakh Crore In FY26

New Delhi: The central government has budgeted to collect about Rs 5.91 lakh crore from cess and surcharge in the current fiscal, a 9.43 per cent growth over the collections in FY25, Parliament was informed on Tuesday.

As per data shared by the government in the Rajya Sabha, the Centre has budgeted to collect about Rs 4.18 lakh crore from cess and Rs 1.72 lakh crore from surcharge in FY26. This is higher than FY25 cess and surcharge collection of Rs 3.87 lakh crore and Rs 1.53 lakh crore, respectively.

In a written reply to a question in the House, minister of state for finance Pankaj Chaudhary said cess and surcharge are levied by the central government for the purposes of the Union under Article 271 of the Constitution. “The proceeds of such surcharge and cess go towards meeting certain specific needs such as financing of Centrally Sponsored Schemes. The benefits of such expenditure also percolate to states,” he said.

Replying to a separate question in the House, finance minister Nirmala Sitharaman also said that the government collected Rs 83,071 crore in 2024-25 by levying health and education cess, while it spent Rs 87,199 crore from the kitty. Giving details of the amount of health and education cess collected from income tax payers in addition to income tax during the last three years, Sitharaman said that in 2023-24 and 2022-23 the government collected Rs 69,891 crore and Rs 60,616 crore, respectively from the cess.

During FY24 and FY23, spending from health and education cess kitty stood at about Rs 80,010 crore and Rs 70,589 crore, respectively. Gross tax revenue collected by the Centre forms part of the divisible pool and distributed between the Centre and states. Collection from surcharges and cess do not form part of the divisible pool and are hence not shared with states.