Finance Minister Nirmala Sitharaman will present the Union Budget 2024 on July 23, 2024. The full budget for the year is keenly awaited.
Here are some key terms to understand if you want to analyse the budget and know what things actually mean and how they impact you.
Fiscal deficit
A fiscal deficit is the difference between the government’s total expenditure and total receipts.
Fiscal Year or Financial Year
It is the period of 12 months used by the government for budget and accounting purposes. The financial year in India starts on April 1 every year and ends on March 31 of the next year.
Gross domestic product (GDP)
GDP is the total market value of all final goods and services within a country in a specific time period. It’s an important metric for a country’s financial performance.
Central plan outlay
It is the plan describing how the monetary resources of a country are distributed among the various sectors as well as the ministries of the central government.
Balance of payments
It is the difference between the money flowing into a country’s economy and the money outflowing from the country to the rest of the world. In short, it is a statement of all transactions between countries.
Direct and indirect taxes
Direct tax is directly applied to individuals and companies like income tax, corporate tax, etc. Indirect tax is applied to goods and services like GST, excise duty, etc.
Public account
The central government acts as a banker for several transactions regarding provident fund, reserve funds, etc.
Consolidated fund
A consolidated fund is one where the government combines all of its funds together like revenues, loans, etc. This is used for all government expenditures.
Contingency fund
A contingency fund is the emergency fund that needs Parliament’s approval in case it needs to be spent and has to be returned later.