What is Interim Budget Meaning: An Interim Budget is presented during the transition period when a new government is due to take over but the ruling government needs Parliament's go-ahead to take out money from the Consolidated Fund of India.
Interim Budget Meaning: Interim, by the dictionary, means “temporary” or something that is done for a stipulated period of time, as a stopgap measure. An interim budget is presented during the transition period when a new government is due to take over but the ruling government needs Parliament’s go-ahead to take out money from the Consolidated Fund of India, where all the revenues are kept, for its expenses. The Interim Budget documents every detail of the government’s expenses and earning during that period. The Interim Budget contains all the relevant estimates of the government’s expenditure and revenue, and also some policy measures if necessary.
How is Vote on Account different from Interim Budget?
In the Budgetary context, ‘Vote on Account’ and ‘Interim Budget’ are two different terms. The ‘Vote on Account’ is just the estimate of expenses the outgoing government requires before the General Election’s period. The ‘Vote on Account’ only deals with the government’s expenditures. On the contrary, an Interim Budget gives full details of the government’s accounts, including both receipts and expenditures.
What is the difference between the Interim and final budget?
An Interim Budget is a complete financial statement by the government for the entire year, similar to a full Budget in certain terms. Note that an incoming government can change estimates when the final budget is presented.
When is an Interim Budget required?
An outgoing government is required to present an interim budget if its tenure is about to come to an end due to impending General Elections. In such situations, the task of presenting a full Budget is left for the next government. A full Budget approves government spending for the full financial year. So for any reason, if the government of the day is not able to present in the Parliament a full budget before the end of the financial year, it requires Parliament’s sanction for expenditures till the time a full Budget is presented.
How is an Interim Budget prepared and passed in India?
For those are asking, “when will Interim Budget be implemented”, here’s what you need to know about the process. Under the Interim Budget, Parliament clears the government’s vote-on-account which allows it to meet its expenses until the new Parliament considers and passes a full Budget for the remaining year. In the case of government changes due to General Elections and not because of losing a trust vote situation, the vote-on-account is given for a period of four months.
Constitutionally, in the Interim Budget, the government can make tax changes but in all the interim budgets since Independence, outgoing governments have respected the fact that it is only a custodian for a few months and have refrained from making big-ticket changes or new schemes or plans.
On how many occasions an Interim Budget is presented in India?
Usually, an Interim Budget is presented by the outgoing government before the General Elections for Lok Sabha held every five years. Here are fourteen instances when Interim Budgets were presented in the Parliament:
- By R K Shanmukham Chetty on November 26, 1947 after Constituent Assembly’s Budget passed in March 1947 ceased because of partition
- By CD Deshmukh, before the first General Elections, for 1952-53
- By T T Krishnamachari for 1957-58, just before the second general elections
- By Morarji Desai in 1962-63 and then in 1967-68
- By Y B Chavan for 1971-72
- By Haribhai M Patel in 1977. It was the shortest ever interim budget speech and also the first when an interim Budget was presented by a finance secretary and a former bureaucrat
- By R Venkataraman for 1980-81 after Janata government lost power to Congress (I)
- By Yashwant Sinha in 1991 after the fall of the Chandra Shekhar government
- By Dr Manmohan Singh — his only interim budget in 1991-92
- By Yashwant Sinha for 1998-99 during Atal Bihari Vajpayee’s government
- By Jaswant Singh, in the final year of Atal Bihari Vajpayee-led NDA government in 2004-05
- By Pranab Mukherjee in 2008-09 at the end UPA’s first term
- By P Chidambaram on February 17, 2014 at the end of UPA’s second term
- By Piyush Goyal in 2019 before the end of PM Narendra Modi-led NDA government’s first term