As per data shared with the Rajya Sabha, the Centre has budgeted to collect over ₹4.18 lakh crore from cess in the current fiscal year, higher than about ₹3.87 lakh crore from Revised Estimates (RE) of Union Budget FY25.
This 8 per cent growth would still be lesser than the 13 per cent higher collections expected from surcharges, which may be over ₹1.72 lakh crore in the ongoing 2025-26 fiscal year (April-March) as against ₹1.53 lakh crore collection according to RE in FY25.
Notably, collection from surcharges and cess do not form a part of the divisible pool and are hence not shared with states. It is only the gross tax revenue collected by the Centre that forms part of the divisible pool and distributed between the Centre and states.
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In a written reply to a question in the Upper House, the Minister of State for Finance Pankaj Chaudhary said cess and surcharges 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 toward meeting certain specific needs such as financing of Centrally Sponsored Schemes. The benefits of such expenditure also percolate to states,” he said.
Currently, eight different cesses are in operation, which include those from agriculture infrastructure and development, crude oil, exports, GST compensation, health, health and education, national calamity contingent duty, and road and infrastructure.
Surcharges are levied on corporate tax, income tax, and social welfare surcharge under Customs.
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