GK Quiz on Union Budget: Challenge Your Knowledge of India’s Finances

With the Union Budget 2026 just around the corner, it's time to refresh your understanding of this pivotal financial statement. The Union Budget outlines the government’s revenue and expenditure plans for the upcoming fiscal year, impacting every sector of the economy and every citizen. This year’s budget is particularly anticipated as the government aims to address inflation, boost infrastructure, and strengthen welfare initiatives in a post-pandemic recovery phase.

Here are MCQ questions to test your knowledge about the Union Budget. These questions will help you understand the country's budget in a better format as well as help you prepare for different competitive exams. 

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1. Who presents the Union Budget of India?

a) Prime Minister
b) Finance Minister
c) President of India
d) Governor of RBI

Answer: b) Finance Minister

Explanation: The Finance Minister of India presents the Union Budget in Parliament every year, detailing the government's revenue and expenditure plans.

2. When is the Union Budget usually presented?

a) 1st January
b) 26th January
c) 1st February
d) 15th March

Answer: c) 1st February

Explanation: Since 2017, the Union Budget is presented on February 1st to allow implementation from the beginning of the financial year.

3. What is the fiscal year period in India?

a) April 1 to March 31
b) January 1 to December 31
c) June 1 to May 31
d) October 1 to September 30

Answer: a) April 1 to March 31

Explanation: The Indian fiscal year starts on April 1 and ends on March 31 of the following year, aligning with tax and accounting practices.

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4. What is the fiscal deficit?

a) Total tax collected by the government
b) Difference between imports and exports
c) Total expenditure minus total receipts (excluding borrowings)
d) None of the above

Answer: c) Total expenditure minus total receipts (excluding borrowings)

Explanation: Fiscal deficit shows the amount the government needs to borrow to meet its spending commitments.

5. Who was the first Finance Minister to present the Union Budget of independent India?

a) R. K. Shanmukham Chetty
b) Jawaharlal Nehru
c) Morarji Desai
d) C. D. Deshmukh

Answer: a) R. K. Shanmukham Chetty

Explanation: R. K. Shanmukham Chetty presented the first Budget on November 26, 1947, soon after independence.

6. What is a 'Vote on Account'?

a) A summary of the budget
b) A temporary arrangement for expenditure
c) A report on government debt
d) None of the above

Answer: b) A temporary arrangement for expenditure

Explanation: A Vote on Account allows the government to withdraw funds for essential expenses until the full budget is passed.

7. Which constitutional article relates to the Union Budget?

a) Article 110
b) Article 320
c) Article 124
d) Article 112

Answer: d) Article 112

Explanation: Article 112 of the Constitution mandates the presentation of the Union Budget, referred to as the Annual Financial Statement.

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8. What does GDP stand for?

a) Gross Domestic Product
b) Gross Development Plan
c) General Data Policy
d) Government Development Project

Answer: a) Gross Domestic Product

Explanation: GDP is the total monetary value of all goods and services produced in a country during a specific period.

9. Which sector gets the highest allocation in most Union Budgets?

a) Education
b) Defence
c) Infrastructure
d) Agriculture

Answer: b) Defence

Explanation: Defence is often one of the top priorities, receiving a significant share of the Union Budget for national security.

10. What is a direct tax?

a) Tax levied on income and profits
b) Tax on goods and services
c) Tax on imports and exports
d) None of the above

Answer: a) Tax levied on income and profits

Explanation: Direct taxes, like income tax, are paid directly by individuals or organizations to the government.

11. What is the Union Budget also officially called in the Constitution of India?

a) National Expenditure Plan
b) Annual Financial Statement
c) Central Revenue Report
d) Government Ledger

Answer: b) Annual Financial Statement

Explanation: The Constitution refers to the Union Budget as the Annual Financial Statement under Article 112.

12. Which ministry prepares the Union Budget?

a) Ministry of Commerce
b) Ministry of Finance
c) Ministry of Home Affairs
d) Ministry of Planning

Answer: b) Ministry of Finance

Explanation: The Ministry of Finance coordinates the preparation of the Budget.

13. What is the main purpose of the Union Budget?

a) To control elections
b) To outline government income and expenditure
c) To appoint ministers
d) To regulate foreign trade only

Answer: b) To outline government income and expenditure

Explanation: The Budget provides a yearly plan of how the government will earn and spend money.

14. What is a surplus budget?

a) When borrowing increases
b) When expenditure equals income
c) When income exceeds expenditure
d) When taxes are removed

Answer: c) When income exceeds expenditure

Explanation: A surplus budget occurs when government earnings are higher than its spending.

15. What is the Railway Budget now merged with?

a) State Budget
b) Defence Budget
c) Union Budget
d) Municipal Budget

Answer: c) Union Budget

Explanation: Since 2017, the Railway Budget has been merged into the Union Budget.

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