What is the difference between Interim Budget and Voting on Account?

Union Finance Minister Nirmala Sitharaman will present the Union Budget 2023 in Parliament on February 1, 2023.

This is also Nirmala Sitharaman’s 6th budget presentation as Finance Minister. The 2023-24 budget session is the last official Union Budget presented by the Modi Government. Lok Sabha elections will be held in early 2024 and the interim budget will be presented next year.

Union Finance Minister @nsitharaman to the National Assembly to present #CoalitionBudget 2023-24

Stay tuned for the highlights and see #AmritKaalBudget Speech here⬇️https://t.co/98WziRP2dK#UnionBudget2023 pic.twitter.com/CDCVtuTtG4

— PIB India (@PIB_India)
February 1, 2023

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People often confuse interim budgets and voting on accounts because they sometimes represent the same things but when the new Budget is upon us. On February 1, 2023, it is more important to learn exactly what each means and what the differences are between them.

Although there are some fundamental differences between the Vote on Account and the Interim Budget, some people may see them as similar as they are both important parts of our constitution and provide the same function. It is essential to ensure that the government has sufficient funds to carry out its regular operations. They are mainly used to account for the spending of the ruling government.

Most of India’s revenue is retained through the consolidated India fund and this subsidy usually lasts for 2 months until the new financial year begins. It has been observed that interim budgets are often commissioned during an election year or transition period.

The main difference between Vote of Account and Interim Budget is that Vote of Account cannot impact the tax regime, whereas interim budget can impact or change it.

People may use these terms interchangeably but let’s understand in detail how significantly they differ.

READ|Important terms related to union budget

What is the interim budget?

The interim budget is presented to the National Assembly by the Government in case the Government does not have time to present the entire budget. This usually happens when the election is approaching and the Budget will be presented before voting is over. It only makes sense if the ruling Government presents the Budget.

This way, the incumbent Government will have power until the end of the financial year and not the outgoing government.

When the new government develops a new budget, it can change or follow the estimates set out in the interim budget as it sees fit.

However, it is presented for the entire year like a regular budget. In the Interim Budget, the Election Commission binds the Government with various policies that cannot influence the public before voting begins.

What is account voting?

It passed the interim budget and allowed the Government to meet small expenditures before the election. It was adopted as a convention and no discussion took place in it. It is like an advance subsidy that the government needs to operate until the time of the vote on funding needs and the passage of the Finance Bill and the Appropriation Bill.

Difference between Interim Budget and Voting on Account

Interim budget	Vote on account
In the run-up to elections, it is impractical to present a full budget, so the government will present an interim budget.	Vote on account is a provision where the government requires Parliament’s approval for funds sufficient to cover until the formation of a new government takes place.
The interim budget includes both expenditure and income	A vote on accounts lists only the expenditures incurred by the government
It has to be discussed in the Lok Sabha and then passed.	Voting on account is considered a formal matter and can therefore be passed by the Lok Sabha without discussion
The Indian government also has the power to make changes in the tax regime in the interim budget.	Voting on Account cannot change Direct Taxes at any cost. Any changes in direct taxes can only be made by passing the Finance Bill.
It is like a budget for the transition period (when the Government is in power for a few months).	A vote on account may be adopted for the provisional budget.
The interim budget is valid for the entire year.	A vote on an account is usually valid for 2 months.

READ|Nirmala Sitharaman Biography: Date of Birth, Age, Family, Education, Political Career, Recognition etc. About India’s Finance Minister

Bottom line

The main difference between Vote on Account and Interim Budget is

• Voting on account only covers government expenses, while the Interim Budget handles collections and payments.
• Voting on account is valid for two months, while the Interim Budget is a budget for a period of change as the election approaches.

Also read| What is the difference between Money Bill and Finance Bill?

What is the difference between Lok Sabha and Rajya Sabha?

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Source: pagasa.edu.vn