Finance minister Nirmala Sitharaman is set to present the interim budget on February 1, 2024, extending its validity until the upcoming general elections.
What is the need of Budget?
According to the Constitution, the Union government's revenue and loans are held in the Consolidated Fund of India, and drawing from it requires parliamentary approval. Thus, the budget, which also has a projected income and expenditure statement, is passed to appropriate funds for the upcoming financial year.
What is an interim Budget?
During election years, the outgoing government refrains from imposing policy changes or budget constraints on its successor.
The Interim Budget, a parliamentary norm during election years, allows the government to cover expenses until the new government takes charge.
Also read: 10 things to know about Modi government's 'interim budget'
What is a vote on account?
In another circumstance, if the financial year has ended and budget is yet not passed, the government can’t access funds until the appropriation bill's enactment. To address immediate expenses, the Constitution empowers the Lok Sabha to grant funds in advance for a part of the financial year, known as the 'Vote on Account.'
Then finance minister Arun Jaitley started presenting the union budget on February 1 from 2017, thus no need for vote on account for this purpose.
{{/usCountry}}Then finance minister Arun Jaitley started presenting the union budget on February 1 from 2017, thus no need for vote on account for this purpose.
{{/usCountry}}So, the vote on account presently is used mostly through the Interim Budget, granting temporary permission for administrative expenses until the new government is formed, typically valid for two months and extendable.
FM Sitharaman confirmed that the February 1, 2024 budget will solely be a vote-on-account due to the impending elections, with the full-fledged budget anticipated in July.
What is difference between interim budget and vote on account?
• Interim Budget encompasses both expenditures and receipts; Vote on Account lists only government expenditures.
• Interim Budget undergoes discussion and passage in the Lok Sabha; Vote on Account, specific to expenditures, is passed without discussion.
• Interim Budget can propose tax regime changes; Vote on Account cannot alter taxes.
• Interim Budget, akin to a full budget, projects for a few months; Vote on Account is passed within the interim budget.
• Interim Budget is valid for a year; Vote on Account usually holds for two months.