New Delhi, February 2 India’s Budget allocation for health and education sectors, minus the cess component, has gone down by 3-odd per cent, between FY23 and FY24 estimates.

Taking out the aniticipated health and education cess collections, cumulative outlay stands at ₹1,32,991 crore (for FY24 BE); against ₹1,36,631 crore in FY23 BE, down by ₹3,640 crore.

However, if the cess component is taken into consideration, then outlay to the two sectors put-together stand at ₹2,02,054 crore in FY24 (Budget Estimate-BE), up 6 per cent over FY23 (BE) which was at ₹1,90,477 crore.

The contribution of Health and education cess as a percentage of total outlay in these sectors have also moved up from 28 per cent (FY23 BE) to 34 per cent (FY24 BE). The revised estimate (RE) for FY23 show cess to be 35 per cent of the outlay.

Cess is levied at 4 percent of the tax payable, and is imposed as an additional surcharge on taxpayers for funding select government welfare programmes, specifically primary and secondary education, and health infrastructure.

Cess collections

As per the tax revenue documents of the Budget, anticipated collections from heath and education cess for FY24 is pegged at ₹69,063 crore – which include ₹35,488 crore collection from corporates and ₹33,575 crore from income tax.

In FY23, the Centre estimated cess collections at ₹53,846 crore - ₹27,692 crore from corporation tax and ₹26,154 crore from income tax respectively. Revised estimates for the year pegged these numbers at ₹62,500 crore – ₹32,115 crore under corporation tax collections and ₹30,385 crore from income tax.

Analysis of the Budget documents show that allocations to the education sector was at ₹1,12,899 crore in FY24 BE – which includes both school education and literacy and higher eductation (or 2.5 per cent of the Budget); while outlay for the health sector was at ₹89,155 crore for 2023-24 (1.97 per cent).

Revised estimates of 2022-23 peg outlays at ₹79,145 crore for health and at ₹99,881 crore for education.