Must-Know Terms Before the Finance Minister Presents the Budget
Budget 101:
Finance Minister Nirmala Sitharaman is about to unveil the government's financial roadmap for the year on 23rd July 2024
But before the big day arrives, let's break down some key terms to help you understand the budget.
What is Union Budget?
The Union Budget, mandated by Article 112, is the government's financial plan for each year (April 1st - March 31st). It details expected income (revenue) and spending (expenditure), giving us a roadmap for the nation's finances.
Budget Estimates
Each year, the budget allocates estimated funding to ministries and programs. Think of it as educated guesses! Real spending may differ based on actual needs throughout the year
Fiscal Deficit
The gap between the government's total income and its total spending. A lower deficit indicates responsible financial management.
GDP and Inflation
GDP (Gross Domestic Product)tracks the value of India's yearly output (goods & services). Inflation refers to the rise in prices of goods and services over time. It impacts the cost of living and government spending.
Capital Expenditure
Capital expenditure is the government's investment in the future. It funds building infrastructure, machinery, schools, hospitals, and even land purchases that bring future returns
Direct & Indirect Taxes
Direct taxes are levied directly on your income (like income tax). Indirect taxes are levied on goods and services (like GST).
Consolidated Fund
The most important government account that receives all government revenue (taxes, loans) and from which all government expenditure (excluding some exceptions) is made.