India's Union Budget has transformed from a simple revenue and expenditure statement into a powerful tool for economic reform, crisis management, and institutional change over nearly eight decades. This evolution reflects the nation's journey through wars, economic crises, liberalisation, technological advancement, and governance reforms.

Foundation Years: Building a New Nation

Independent India's first Budget was presented by R.K. Shanmukham Chetty on November 26, 1947. The inaugural budget reflected the priorities of a nascent nation facing immediate challenges.

This budget established the foundation for security, administration, and economic stabilisation as core governmental priorities.

Crisis and Reform Milestones

The 1973-74 Budget, presented by Yashwantrao B. Chavan, earned the notorious label 'Black Budget' due to economic stress, high inflation, and global oil shocks. With a fiscal deficit of ₹550.00 crore—considered substantial for that period—it highlighted the limitations of a tightly controlled economic system.

A significant shift occurred in 1983-84 when Finance Minister Pranab Mukherjee introduced performance-based federalism, allocating central grants to states based on performance rather than population or negotiation. This marked an early attempt to link public spending with accountability measures.

The Liberalisation Era

The most transformative moment came with the 1991-92 Budget presented by Manmohan Singh during a severe balance-of-payments crisis. This epochal budget marked India's decisive turn towards Liberalisation, Privatisation, and Globalisation (LPG). Key reforms included:

• Dismantling of industrial licensing
• Easing of trade controls
• Welcoming foreign investment
• Initiating public sector reform

The 1997-98 'Dream Budget' by P. Chidambaram applied Laffer Curve logic to reduce personal and corporate tax rates while explicitly recognising information technology as a growth engine, catalysing India's IT boom.

Institutional Strengthening and Digital Foundations

The 2003-04 Budget introduced the Fiscal Responsibility and Budget Management (FRBM) framework under Jaswant Singh, legally binding future governments to deficit and debt targets. This shift from discretionary to rules-based budgeting enhanced fiscal transparency through mandatory policy statements.

Pranab Mukherjee's post-global financial crisis budgets (2009-12) supported the Aadhaar rollout and early direct benefit transfer pilots, establishing the groundwork for the JAM (Jan Dhan–Aadhaar–Mobile) architecture that would later transform governance delivery.

Modern Era: GST and Beyond

The 2017-18 Budget under Arun Jaitley preceded the Goods and Services Tax rollout, creating the GST Council as a landmark institution for consensus-driven federal decision-making. This represented a significant advancement in cooperative federalism.

Recent budgets have emphasised infrastructure development and tax reform. The 2020-21 Budget introduced the National Infrastructure Pipeline and an alternative personal income tax regime. The 2021-22 'once-in-a-century' Budget prioritised capital expenditure, healthcare, and asset monetisation over short-term consumption stimulus during the pandemic response.

Current Trajectory

The 2025-26 Budget deepened tax reform by raising the no-tax income threshold under the new regime and announcing a new Income Tax Bill. It revised TDS/TCS thresholds and proposed regulatory decriminalisation through Jan Vishwas Bill 2.0, signalling a shift toward trust-based governance.

The Union Budget 2026 is scheduled for presentation on February 1, continuing the post-2017 tradition. The upcoming budget is expected to build on recent themes of capital expenditure, tax simplification, and trust-based governance while addressing emerging challenges including global uncertainty, climate financing, and job creation.

The Institute of Chartered Accountants of India (ICAI) has proposed introducing optional joint tax filing for married couples in India, potentially transforming how households manage their tax obligations. The proposal comes ahead of Union Budget 2026-27, which Finance Minister Nirmala Sitharaman will present on February 1, 2026.

Currently, India's income-tax system operates on individual taxation principles, with separate exemption limits and deductions for each taxpayer. Marriage does not alter this treatment, requiring spouses to file and pay taxes independently despite most households functioning with shared incomes and financial priorities.

ICAI's Joint Filing Framework

The proposed system would allow married couples with valid PANs for both spouses to file joint returns and choose combined taxation. Taxpayers would retain flexibility to continue under the existing individual taxation system if preferred.

Under ICAI's framework, the basic exemption limit would be doubled for joint filers, with tax slabs expanded proportionally to accommodate combined household income. The structure ensures income up to ₹8.00 lakh remains tax-free, while the top rate of 30% applies to combined income exceeding ₹48.00 lakh.

Benefits for Single-Income Families

The joint filing system primarily benefits households where one spouse earns significantly more than the other. Under current rules, a non-earning spouse's basic exemption limit and lower tax slabs remain unutilized. Joint filing would unlock this capacity through income averaging, potentially reducing overall family tax liability.

Couples could also maximize deductions on home loans, health insurance premiums, and other eligible tax-saving investments more effectively. The system encourages cohesive household financial planning and simplifies investment structuring, according to tax experts.

Expert Perspectives and Limitations

Priyal Goel Jain, CA and partner at Dinesh Aarjav & Associates, highlights that joint filing aligns with the government's vision of a simplified tax regime with minimal deductions and cleaner slab-based taxation. Retired couples would particularly benefit from smoother taxation of pension and investment income, reducing complex tax arbitrage needs.

However, joint filing may not always prove tax-effective, especially when both spouses are high income earners. Combined income could push couples into higher tax brackets or surcharge categories, potentially increasing their overall tax burden.

Budget Timeline and Implementation

Parliament's budget session begins January 28, 2026, and continues until April 2, 2026. The proposal follows practices already established in countries like the United States and Germany, where joint filing for married couples represents standard practice. The optional nature of the proposed system ensures couples can choose the most beneficial taxation method for their specific circumstances.