DMPQ- What is interim budget?

Interim Budget, also known as ‘a vote on account’, essentially means that the government seeks the approval of Parliament for meeting expenditure for the first four months of the fisca

l year (April-March) — paying salaries, ongoing programmes in various sectors etc — with no changes in the taxation structure, until a new government takes over and presents a full Budget that is revised for the full fiscal.

However, over the years, some governments have made policy announcements or tweaked tax rates in the vote on account. The reasoning is that there is little time to get approvals from Parliament for various grants to ministries and departments and to debate these as well as any provisions for changes in taxation.

More important reasoning is that it would be the prerogative of the new government to signal its policy direction, which is often reflected in the Budget.

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