The Finance Act for 2026-27 Received the President's Assent 57 Days After the Budget Speech, With the Lok Sabha Voting the Spending on 18 March and the Taxes on 25 March

A Union Budget becomes law in two passes through Parliament. The Lok Sabha votes the ministries’ spending demands and passes an Appropriation Bill, then passes a Finance Bill carrying the tax changes, and the Rajya Sabha can only send recommendations on either. For 2026-27 the Finance Minister spoke on 1 February 2026, the Lok Sabha passed the Appropriation (No. 2) Bill on 18 March and the Finance Bill on 25 March, the Rajya Sabha returned both on 27 March, and the Finance Act, 2026 received the President’s assent on 30 March. That is 57 days from speech to assent, two days before the financial year began on 1 April.

Each step is laid down in Articles 112 to 117 of the Constitution and in Chapter XIX of the Lok Sabha’s Rules of Procedure. This article follows one Budget through them.

Why there are two laws

Article 265 says no tax can be levied or collected except by authority of law. Under Article 266, all revenues, loans and loan repayments received by the Government of India go into one Consolidated Fund of India, and no money can be appropriated from it except in accordance with law. Taxing and spending each need their own statute, and the Budget carries both.

Article 112 starts the sequence: for every financial year the President must have an “annual financial statement” laid before both Houses, showing the estimated receipts and expenditure. According to the Finance Ministry’s own guide to the Budget documents, three papers are mandated by the Constitution: that statement (Article 112), the Demands for Grants (Article 113) and the Finance Bill (Article 110). Everything else in the pile, from the Expenditure Budget to Budget at a Glance, explains those three.

Two kinds of spending have to be kept apart in that statement. Article 112(3) lists expenditure “charged” on the Consolidated Fund, including the President’s emoluments, the salaries and pensions of Supreme Court judges, the Comptroller and Auditor-General’s pay, interest on government debt, and sums needed to satisfy court decrees. Under Article 113(1), Parliament may discuss these but does not vote them. Interest payments, for example, appear as Demand 39 and get a separate appropriation instead of a vote. Everything else goes to the Lok Sabha as Demands for Grants. Budget 2026-27 had 102 of them, generally one per ministry or department, with more than one where the spending is of different kinds.

The work before the speech

Months of consultation come before the speech. In November 2025 the Finance Minister chaired a run of pre-budget meetings. All India Radio reported the 10th, with trade unions, on 20 November, and the 11th, with infrastructure and energy experts, and the 12th, on urbanisation, on 21 November. It also reported that the ministry holds several such meetings a year with experts, industry, economists and state officials.

The President sets the date itself. Rule 204 of the Lok Sabha’s rules has the Budget presented on the day the President directs, and Rule 205 bars any discussion that day.

Why it arrives on 1 February, with the railways inside

Up to 2016 the usual date was the last day of February, and the railways presented a separate Budget. On 21 September 2016 the Cabinet approved merging the Railway Budget into the general Budget and advancing the date, both from the 2017-18 Budget. As the Press Information Bureau’s release put it, the separate railway budget had begun in 1924 and continued after independence as a convention, not under any constitutional provision. Its stated aim was to finish all Budget legislation before 31 March, so ministries could plan and spend from the start of the year.

On 1 February 2017 the first combined Budget was presented. The railways kept their identity as a departmentally run commercial undertaking, but their appropriation was to become part of the main Appropriation Bill. In 2026, Railways was one of two ministries whose demands the Lok Sabha debated individually on 18 March.

The speech and the papers on the table

Two parts make up the speech. Part A covers the economy and spending, and Part B the tax proposals. In 2026-27 the speech put total expenditure at 53.5 lakh crore rupees, non-debt receipts at 36.5 lakh crore and the fiscal deficit, the gap borrowing must fill, at 4.3 per cent of GDP.

The Finance Bill is introduced the moment the speech ends. For 2026 it is Bill No. 3 of 2026, and the Finance Minister’s letter of 31 January 2026 to the Lok Sabha Secretary-General conveys the President’s recommendation under Articles 117 and 274, without which a tax Bill cannot be introduced. Its text says it would be introduced “immediately after the presentation of the Budget on the 1st February, 2026”.

Some tax changes cannot wait for the Bill to pass. A law of 2023, the Provisional Collection of Taxes Act, lets a government Bill declare that customs or excise duty changes take effect at once. A declared provision has the force of law from the end of the day the Bill is introduced and lapses when it becomes an enactment or, at the latest, on the 75th day after introduction. That declaration was made in the Finance Bill, 2026 for the customs tariff changes in clause 136(a). Seventy-five days after 1 February is 17 April, which the Finance Act beat by 18 days. Most other provisions of the Bill were set to commence on 1 April 2026.

Debate, committees and the vote on demands

General discussion comes first. Rule 207 lets members discuss the Budget as a whole, but no motion is moved and nothing is voted. At the end the Finance Minister replies.

Then the House pauses. Rule 331G says that after the general discussion the Houses adjourn for a fixed period, the department-related standing committees consider the Demands for Grants of their ministries in that period and report within it, and the House considers the demands in the light of those reports. Their reports have persuasive value and are treated as considered advice, says Rule 331N. PRS Legislative Research records that the Budget Session of 2026 ran from 28 January to 18 April. How the committees and sessions fit together is in how Parliament’s sessions and committees work.

Voting follows. Article 113(2) gives the Lok Sabha three options on each demand: assent, refuse, or assent to a reduced amount. No demand may be made except on the President’s recommendation (Article 113(3)), which means the House can cut a grant and has no way to add to one. Under Rule 209 a member may move a cut motion in three forms: reduce the demand to Re 1 to show disapproval of the policy behind it, cut it by a stated amount to show where savings could come, or cut it by Rs 100 to raise a specific grievance. PRS notes that a cut motion that passed would signify loss of confidence, and the Cabinet would be expected to resign.

Days for the demands are allotted by the Speaker, and Rule 208(2) sets the end point. On the last allotted day, at 5 pm or another hour fixed in advance, the Speaker puts every question needed to dispose of all outstanding matters. Parliamentarians call this the guillotine. PRS’s primer says the Business Advisory Committee picks the handful of ministries to be debated each year, and that in 2004-05, 2013-14 and 2018-19 every demand was guillotined. On 18 March 2026 the Lok Sabha debated Railways and Agriculture, then voted the rest together, approving spending of more than Rs 53 lakh crore, ETV Bharat reported.

Two Bills with different jobs

Article 114(1) requires an Appropriation Bill “as soon as may be” after the grants are made, to authorise withdrawal from the Consolidated Fund of the sums granted plus the charged expenditure. A further clause, 114(2), bars any amendment that would change the amount or destination of a grant. On 18 March the Lok Sabha introduced and passed the Appropriation (No. 2) Bill, 2026, the same day as the vote, PRS records. Rule 218 confines the debate on it to matters of public importance or administrative policy not already raised.

Rule 219 governs the Finance Bill, and its debate can range over general administration, local grievances and monetary or financial policy. It cleared the Lok Sabha on 25 March, 52 days after the speech.

Both are Money Bills, a category Article 110 defines by subject: taxes, government borrowing, the Consolidated Fund and matters incidental to them. A Money Bill cannot be introduced in the Rajya Sabha. After the Lok Sabha passes it, the Rajya Sabha has 14 days to return it with recommendations, and the Lok Sabha may accept or reject any of them (Article 109). If the Lok Sabha accepts none, or the 14 days pass in silence, the Bill is deemed passed as the Lok Sabha passed it. In 2026 the Rajya Sabha returned both Bills on 27 March, nine days after the Appropriation Bill left the Lok Sabha and two after the Finance Bill did. More on that house is in how the Rajya Sabha works.

The sequence closes with Article 111. The President may return an ordinary Bill for reconsideration, but the proviso excludes Money Bills. LiveLaw reports that the Finance Act, 2026, titled as an Act to give effect to the financial proposals of the Central Government for 2026-27, received assent on 30 March.

When the calendar breaks

Two articles cover the cases the main cycle cannot. Under Article 116 the Lok Sabha can make a grant in advance for part of a year, pending the full procedure, and Rule 214 sets out how that vote on account is moved. It is the tool used when a general election means the new Lok Sabha will pass the main Budget. The interim Budget of 1 February 2024 told the House the Government would seek a vote on account through an Appropriation Bill for part of 2024-25, and, “in keeping with the convention”, proposed no tax changes. PRS described it as funding the government until the main budget was passed after the general elections.

Extra money during the year comes through supplementary demands under Article 115. On 13 March 2026 the Lok Sabha approved the second batch for 2025-26, 61 grants with gross additional spending of more than Rs 2.81 lakh crore, and passed the Appropriation Bill, 2026 to authorise it, All India Radio reported. Both the 13 March Bill and the 18 March Bill carry 2026 in their names but cover different financial years. A Contingency Fund under Article 267 is placed at the President’s disposal for unforeseen spending pending Parliament’s approval, with a corpus of Rs 30,000 crore, the Finance Ministry’s guide says.

Where these financial articles sit in the Constitution is set out in the Constitution at a glance, and the Budget of 24 July 1991 is covered in the 1991 reforms.

What is contested

One step is disputed, namely what counts as a Money Bill. Article 110(1) covers a Bill containing “only” the listed subjects, and Article 110(3) makes the Speaker’s decision final. PRS’s primer points out that Finance Bills have carried items with no link to tax or spending, citing the 2016 Bill’s changes to the Foreign Contribution (Regulation) Act and the 2017 Bill’s reorganisation of tribunals. In Rojer Mathew v. South Indian Bank on 13 November 2019, a Constitution Bench of the Supreme Court referred the question of what a Money Bill is, and the Speaker’s certification of the Finance Act, 2017, to a larger Bench. The Rajya Sabha article linked above covers the case in more detail.

The next cycle is under way

Devdiscourse reports that the Budget Circular for 2027-28 was issued on 27 August 2026 by the Department of Economic Affairs. It asked ministries to enter their data by 6 October 2026, and pre-budget meetings under the Secretary (Expenditure) were scheduled to begin on 12 October 2026 and run to mid-November.