Amid the widening gap between revenue and expenditure, Maharashtra Deputy Chief Minister and Finance Minister Ajit Pawar on Monday presented the budget for 2025-26 with an estimated revenue deficit of $6.1 billion and a fiscal deficit of $18.1 billion.
The finance minister has estimated a total expenditure of $92.2 billion with revenue receipts of $73.8 billion and revenue expenditure of $79.9 billion.
Ajit Pawar claimed that the government has been successful in keeping the fiscal deficit below 3% of gross state domestic income under the Fiscal Responsibility and Fiscal Management Act. The state’s revenue deficit has consistently been less than 1% of gross state income.
However, he did not announce a hike in the monthly financial aid to $28 from $20 to about 2.53 million women beneficiaries under the flagship Ladki Bahin Yojana as promised in the poll manifesto. Since the launch of the scheme, the government has spent $4.4 billion. For 2025-26, the finance minister has allocated $4.8 billion with special plans to further encourage women groups to utilize the subsidy. Moreover, he did not announce the farm loan waiver as promised in the poll manifesto.
He proposed an amnesty scheme of the State Tax Department for public sector undertaking companies to clear their arrears. The scheme, titled Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act 2025, will be in force from the commencement of the Act until December 31, 2025.
To make up for the revenue loss, the finance minister proposed various taxes to generate additional revenue of $150 million. He proposed a 1% increase in Motor Vehicle Tax on individual non-transport four-wheeled CNG and LPG vehicles, which will mobilize $20 million.
He proposed to levy motor vehicle tax at the rate of 6% on electric vehicles priced above $40,000. The maximum limit of motor vehicle tax is proposed to increase from $26,000 to $40,000. The proposed increase in the maximum limit of motor vehicle tax is expected to generate an additional revenue of around $23 million.
He also proposed to levy motor vehicle tax compulsorily on a lump sum basis at the rate of 7% on the price of vehicles used for construction such as cranes, compressors, projectors, and excavators. This will mobilize an additional revenue of $24 million.
Further, the finance minister proposed to levy motor vehicle tax compulsorily on a lump sum basis at the rate of 7% on the price of Light Goods Vehicles carrying goods up to 7,500 kg in the state. This will generate additional revenue of $82 million.
He proposed to increase the stamp duty from $1.30 to $6.50 on supplementary documents if more than one document is used to complete the same transaction. He also proposed to increase the adjudication fee payable on a document under section 3(1) of the Maharashtra Stamp Act from $1.30 to $13 for the chargeability of the instrument and to make a provision for depositing the amount of stamp duty primarily payable while filing the executed document.
He proposed a new provision for e-Stamp Certificates to facilitate citizens to pay stamp duty and issue certificates online.
It was the first budget of the MahaYuti government after its landslide victory in the state Assembly election and Ajit Pawar’s 11th budget as the state finance minister.
He allocated $25 billion for the annual outlay, $3 billion for the scheduled caste component program, $2.8 billion for the tribal component program, and $2.6 billion for district development plans. The finance minister made an allocation of $25 billion for various departments.
The finance minister crafted his budget with a tagline of Viksit Bharat Viksit Maharashtra, saying that a blueprint for the state’s sustainable and inclusive development has been prepared by making allocations for the development of agriculture, irrigation, infrastructure, industry, and social sectors.
The finance minister had estimated the state’s own tax revenue of $45.2 billion in 2024-25 but it has been revised to $48.4 billion in 2024-25. The budget estimate for the state’s own tax revenue for the year 2025-26 is estimated at $51.1 billion.
The highlights of the budget include a higher economic growth rate driven by the right reform-oriented policies and capex, which has a higher fiscal multiplier.
MMR projects will help make it an economic growth hub for India.
Transport – highways, ports, airports, waterways, bus transport, railways, and metros are all priority areas receiving adequate budgetary support.
Industrial Policy 2025 aims to attract new investments and give a push to ‘Make in Maharashtra.’ Quality rural roads, as well as state highways and district roads, are receiving maximum support.
Rural Housing – the biggest scheme outlay of close to $2 billion for a target of 2 million houses. Big rise in SCP, TSP, and General Plan with adequate provisions for newly announced schemes to phase out old irrelevant schemes and bring new schemes in line with current times. FRBM norms compliant state – fiscal deficit and debt to GSDP well within limits.
DBT – mode for bringing speed, efficiency, and transparency in scheme implementation across all individual beneficiary schemes, maximum participation in CSS bringing more central funds. Agriculture growth estimates improved to 8.7% this year in 2024-25 due to state backing farmers from last year’s dismal 3.3%.
Continued support to farmers in improving their income.
More value addition and allied sector income.
Support to meeting energy demand through solar and irrigation will help the farm sector grow at a faster rate.
Cultural heritage – increased support through the budget – Sambhaji Maharaj projects. Valu Aquatic Tourism gets support across Maharashtra.
Sports has received full attention both in the form of policies and budgetary support for developing infrastructure and supporting sportsmen.
Food and Civil Supplies – greater transparency through smart PDS and blockchain technology.
Cooperation Year celebration to highlight Maharashtra leadership financing – asset monetization, rationalization, central assistance, external aided projects, and innovative approaches like Maha InvITs.
Healthcare – within 3 miles and new state policy.
Education – support to implementation of NEP, increasing girls’ participation in professional and technical education.
Support to courts’ infrastructure in the state for speedier disposal of legal cases.
