The 2019 Budget is very much talked about since it is the first budget of the newly elected government and also the first budget to be presented by a Full-time Woman Finance Minister Smt. Nirmala Sitharaman. Before the budget is presented on the 5th July 2019, here is a list of all the important budget terms that will get you prepped to understand the Budget 2019 better.
1. What is a Union budget?
A Union Budget is an annual report prepared by the Government, whereby it lays down the plan for the government's revenue and expenditures.
The main source of the Government's revenue is tax collection. Therefore, in the budget, it introduces if there will be any changes in the laws and methods pertaining to tax collection. As for the expenditure, the government details out the allocation of money that will be spent on the growth of various sectors such as agriculture, trading, manufacturing, etc.
It is prepared for a period beginning from 1st April till 31st March.
2. What is an Interim Budget?
At the end of the 5-year term of the ruling party when the central elections will be held, a budget is presented by the operating Government for the period applicable until the new government takes over. Since this budget is prepared for a short duration and it will be followed by a fresh new budget by the party who forms the government after the elections, it is called the Interim budget.
3. Who prepares the budget?
The Budget is prepared by the Budget Division, The Department of Economic Affairs, and the Ministry of Finance.
The Budget Division invites budget estimates from various Ministries/departments. The Finance Minister then examines the proposals received and makes necessary changes after consulting the Prime Minister and briefs the Union Cabinet, about the budget.
The Budget Division then consolidates all the estimates and prepares the budget document.
4. Why is Budget so important?
In Budget, the Government proposes various changes in the tax rates, rebates, grants, etc. These changes have a direct impact on an individual. For example, if the Government proposes to increase the tax rates for a particular commodity say, Automobiles. Now, this increase in tax rate will directly affect the Automobile industry as well as the individuals. For individuals, buying a car will become more expensive than it was before the change in the tax rate.
Therefore, the budget is very important as it affects both on macro and micro level.
5. What are the pre-budget expectations?
Before the budget is announced, various autonomous bodies, economists, industrialists etc. who represent the industry, trade, and commerce share the mass problems and solutions in the form of pre-budget expectations. They bring forth the practical problems of the economy with a proposed solution that is incorporated in the budget will help the industry and individuals.
6. What is a pre memorandum Budget?
A Pre memorandum Budget is a detailed document where the expectations from the budget are precisely mentioned.
7. When is the Budget announced?
The Budget is prepared annually. It is for a period starting from 1st April to 31st March. The Budget is usually announced in the first week of February.
The year in which Union elections are held, two budgets are prepared. One in the month of February by the party into power. It is called the Interim Budget. And after the elections, the party which wins the elections and forms the Government presents a full-fledged Budget in the month of July.
8. Who presents the Budget?
The Budget is usually presented by the Finance Minister of India.
9. What is the Rail Budget?
A Rail Budget is the projected revenue and expenditures pertaining to railways only. Earlier, it was presented separately, but Mr. Arun Jaitley had changed this practice and now the Rail Budget is presented along with the Union Budget.
10. Who announces the Rail Budget?
The Rail Budget is announced by the Finance Minister of India. Therefore this time, the Union Budget 2019 will be presented by The Hon. FM Nirmala Sitharaman.
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