1 . Union Budget:
Union Budget is a comprehensive account of the finances. It lays down consolidated report of revenue from all sources, and outlays for schemes and projects. The budget also carries Budgeted Estimates which are the estimates of the Central government’s accounts for the upcoming fiscal.
2 . Direct and Indirect Taxes:
Direct taxes impose direct liability on individuals and corporations like income tax, corporate tax et al. Indirect taxes like GST, excise duty, customs duty etc are paid on purchasers of goods and services and are collected indirectly by the government.
3 . Customs Duty:
This is a levy charged on the price of goods that cross India’s international borders. It is paid first by either the importer or the exporter. This levy is also usually passed down to the customers via the supply chain.
4 . Corporate Tax:
Corporate tax is the tax imposed on the income of corporations or firms and it is a direct tax.
5 . Minimum Alternative Tax (MAT):
MAT is the minimum tax liability of a company even it lies under zero tax limit.
6 . Goods and Services Tax:
GST is an indirect tax applicable on supply of goods or services or both. The exceptions items like essential foods, petroleum etc. Goods here mean any movable property barring money and securities. Though it includes actionable claim growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply.
Services mean anything other than goods, money and securities. It includes activities involving use of money, conversion of money by any mode, form, currency, and denomination for which a separate consideration is levied.
7 . Fiscal Deficit:
When the entire expenditure of the government is more than the total non-borrowed receipts, it has to meet the gap. The money to meet the gap is usually borrowed from the Reserve Bank of India or from the capital market by issuing instruments like bonds and treasury bills. The portion of the expenditure in excess of the non-borrowed receipts is the fiscal deficit. The fiscal deficit rate is the percentage measure of the excess.
8 . Primary Deficit:
Primary deficit is fiscal deficit minus interest payments. Primary deficit gives a picture into how much of the borrowings by the government are being utilised to meet expenses other than interest payments.
9 . Revenue Deficit:
When there is a shortfall in the current receipts of the government against the current expenditure, the shortfall is called revenue deficit. It is calculated as the difference between revenue expenditure and revenue receipt.
10 . Fiscal Policy:
It is the policy formulated to outline government actions considering the aggregate revenue and expenditure. It is the primary tool to influence the country’s economy and the implementation of fiscal policy is done via the budget.
11. Monetary Policy:
Monetary policy is formulated by the Reserve Bank of India and it governs aspects like liquidity in the economy, benchmark rates like repo rate, reverse repo rate, steps to control inflation etc.
12 . Inflation:
Inflation is described as sustained hike in prices. Inflation rate is the percentage rate of hike in prices.
13 . Capital Budget:
Capital Budget lists down the capital receipts and payments. Capital budget includes government’s investments in shares, loans and advances given to states, PSUs, corporations etc.
14 . Revenue Budget:
It is comprised of revenue receipts and expenses. Revenue receipts are listed in two categories — tax and non-tax revenue. Tax revenue is receipts from taxes like income tax, corporate tax, indirect taxes, duties and government levies etc. Non-tax revenue includes dividends and interest accrued from loans.
15 . Finance Bill:
After the Finance Minister presents the Union Budget, the Finance Bill is tabled immediately before the House. It proposes detailed changes, impositions, alterations or abolition to taxes, duties and levies. The bill brings into immediate effect the financial proposals by the government for the coming fiscal. It may also include provisions that give effect to additional financial proposals. The Finance Bill also recommends amendments to several acts like Income Tax Act 1961, Customs Act 1962 and more.
16 . Vote on Account:
Vote on Account is the grant that the parliament makes in advance to meet the expenditure estimated for a part of the coming financial year. The grant is made after clearing all the procedures for voting on demand for grants as well as the passage of the Appropriations Act.
17 . Excess Grants:
If the expenditure exceeds the original grant and supplementary grants, the excess needs to be regularised after obtaining the excess grant from Parliament. As is the case in the Annual Budget, it will then have to go via presentation of demand for grants and then passage of the Appropriation Bills.
18 . Budget Estimates:
Budget estimates are the allocations for ministries, schemes and projects for the upcoming financial year.
19 . Revised Estimates:
Revised estimates are simply mid-year reviews of possible expenditure. It also accounts for the rest of expenditure, new services and its instruments. No voting is held in Parliament for revised estimates. The parliament, though, authorises any supplementary projections in the revised estimates by parliament’s approval or a re-appropriation order.
20 . Re-appropriations:
As the name suggests, government uses re-appropriations to re-appropriate sums under one subhead to another in the same grant. It is sanctioned by competent authorities during the financial year for which the grant or appropriation concerned. These re-appropriations are reviewed by the Comptroller and Auditor General of India which makes comments for corrective action.
21 . Outcome Budget:
The Outcome Budget is a progress report on the use of outlays by ministries from the previous annual budget. It is an effective measure to check outcomes of development schemes and also allows whether the ministries actually spent the sanctioned money for the purposes it was meant for.
22 . Cut Motions:
A motion to reduce demands for grants is brought in form of Cut Motion. It seeks slashing the sum demanded on various grounds like economic factors, difference of opinion over policy or some grievances.
23 . Contingency Fund of India:
It is a fund that is kept at the disposal of the President of India. It enables the President to provide advances to the government to meet any unforeseen urgent or critical expenditure.
24 . Public Account:
Public Account is used for fund flows where the Union government acts as a banker. These include small savings, provident funds etc. Public Account is subsequently returned to the depositors and does not belong to the government in any way. The parliament is not required for approving the expenditure from Public Account.
25 . Consolidated Fund of India:
Consolidated Fund of India is one into which all revenues, borrowings and receipts from loans advanced by the government flow. The expenditure of the government is met from the Consolidated Fund of India except for those expenses which are met via contingency fund of public account. Money cannot be appropriated from this fund except in certain conditions in accordance with the law.
26 . Disinvestment:
Disinvestment is sale of assets of public sector undertakings. The government has at its disposal shares of PSUs as earning assets. When these earning assets are sold, they are converted into cash. Hence, the term disinvestment.