Finance Minister Nirmala Sitharaman in Dec’23 announced that the next Budget will be an account vote and there will be “no sensational announcement” as the government will be in election mode. When it is an election year, the current ruling government presents an interim budget or seeks a vote on account instead of presenting the full Union Budget. Budget 2024 will be presented as an interim budget on February 1, 2024.
With Lok Sabha elections just a few months away, expectations from the interim budget are high to see what the government has to offer its people. The last vote, or interim budget was presented back in 2019, by Piyush Goyal, who held the additional charge of the Finance Ministry, and maintained the common pattern, with only two big-ticket announcements being the Income Tax rebate and PM Kisan. Samman Nidhi Yojana Yojana, a farmer support scheme.
The interim budget, which will be presented on February 1, 2024, will be finance minister Nirmala Sitharaman’s sixth Budget, with which she will tie up with former chief minister Morarji Desai.
A full financial year Budget will be presented by the government that will come to power after the Lok Sabha elections in 2024. That Budget is likely to be presented sometime in June or July.
What is an account vote and how is it different?
According to Article 116 of the Indian constitution, a vote on account is a grant in advance for the Central government to meet short-term expenses, generally lasting a few months until the new financial year begins.
To put it simply, when an outgoing government seeks temporary permission from Parliament to withdraw funds from the Consolidated Funds of India and spend that on expenses and major government schemes for a few months until a new government is formed it is called a vote on account.
According to the Finance Minister’s statement, this will be a vote on an account rather than an Interim Budget.
Although both are used interchangeably, a temporary budget is one that contains both the income and expenditure details for the period until the new government takes over and presents a full budget, while a vote in account includes only the government’s expenses.
Provisional Budget mainly includes the current state of the economy, plan and non-plan expenditures, receipts, changes in tax rates, revised estimates of the current financial year and estimates for the next financial year. On the other hand, if the Parliament passes a vote on an account, it would be to meet the essential expenses such as salaries of central government employees, financing of ongoing projects, and other government expenses.
In terms of validity, a provisional Budget is valid for a year while voting on an account is valid only for a period of two to four months.
During an election year, the incumbent government cannot present a full Union Budget. Therefore, an interim budget is announced with projections only for the next three to four months instead of the entire fiscal year.
While the interim budget may not have major announcements, many expectations have started to flow in, but the anticipation is hoping for increased allocation to education, health and technology. People want the Finance Minister to also look at employment, women empowerment and health.