Budget 2018: The countdown for budget 2018 has begun and like every year, there will be a set of confusing economic jargon and terms that will be used repeatedly in television debates and newspapers. These economic terms are often technical and people tend to overlook the entire Budget as they find them difficult to understand. A thorough understanding of the Union Budget requires a short insight on some crucial subjects like Fiscal Deficit, Revenue Deficit, Primary Deficit, Monetary Policy, Fiscal Policy, Inflation, Capital Budget and Money bill. One such important term is ‘Finance Bill’. Here’s a quick look at what a Finance Bill is and where will it find its place during the presentation of Budget 2018.
What is Finance Bill?
As per Article 110 of the Constitution, a Finance Bill is a Money Bill. To be presented immediately after Budget 2018, the Finance Bill is a secret legislation introduced every year in Lok Sabha at the same time to give effect to the taxation proposals brought forward by the government. The Finance Bill finds its mention in Rule 219 of the Rules of Procedure of Lok Sabha.
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The Finance Bill is brought in fulfilment of the requirement of Article 110 (Money Bill) (1)(a) of the Constitution. Every year, the finance minister brings the bill to amend the Finance Act – through which the changes in various direct and indirect taxes are made. However, Budget 2018 may not see many amendments in indirect taxes due to the introduction of Goods and Services Tax which has transferred the right to amend the same to GST council. In a nutshell, Finance Bill can be considered as an umbrella Act, provisions of which are imposed on a number of other acts.
The bill is accompanied by a Memorandum which contains the explanations of the provisions included in it. The Finance Bill can be introduced only in Lok Sabha. However, the Rajya Sabha has the right to recommend amendments to the Bill. It should be noted that here that the Finance Bill is a Money Bill, but every Money Bill is not a Finance Bill. After its introduction after the Budget 2018, the Finance Bill, as per provisions, will need to be passed within 75 days.
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Finance bills can be further divided into three categories: finance bill category I, finance bill category II and money bill. Categories I and II of the Finance Bill generally contain provisions related to taxation and expenditure or provisions related to any other matter. The Lok Sabha speaker has the power to decide whether the bill is a Finance Bill or Money Bill. A copy of the Finance Bill will be uploaded on the government’s official website www.indiabudget.gov.in after Budget 2018 is presented in parliament on February 1.