Union Budget is the most comprehensive report of the government’s finances in which revenues from all sources and outlays for all activities are consolidated. The Budget also contains estimates of the government’s accounts for the next fiscal year called Budgeted Estimates. The interim budget is scheduled to be presented on February 1, 2019, by the government in the Parliament. Interim budget contains key details such as where money comes from and where it is spent, as well as projections of growth and fiscal position.
Here are 5 important budget terms that you should know:
Capital Budget: The capital budget consists of capital receipts and payments. It includes investments in shares, loans and advances granted by the central government to state governments, government companies, corporations and other parties.
Vote on account: The Vote on Account is a grant made in advance by the parliament, in respect of the estimated expenditure for a part of new financial year, pending the completion of procedure relating to the voting on the Demand for Grants and the passing of the Appropriation Act.
Direct and Indirect Taxes: Direct taxes are the one that fall directly on individuals and corporations. For example, income tax, corporate tax etc. Indirect taxes are imposed on goods and services. They are paid by consumers when they buy goods and services. These include excise duty, customs duty etc.
Revenue Budget: Revenue Budget consists of revenue receipts of the government and its expenditure. Revenue receipts are divided into tax and non-tax revenue. Tax revenues constitute taxes like income tax, corporate tax, excise, customs, service and other duties that the government levies. The non-tax revenue sources include interest on loans, dividends on investments.
Outcome Budget: From the fiscal year 2006-07, every Ministry presents a preliminary outcome budget to the ministry of finance, which is responsible for compiling them. The outcome budget is a progress card on what various Ministries and Departments have done with the outlays in the previous annual budget. It measures the development outcomes of all government programs and whether the money has been spent for the purpose it was sanctioned including the outcome of the fund usage.
Source: NDTV Profit