At 11 am on Wednesday, 1st February, Finance Minister Arun Jaitley presented the 2017-18 Union Budget. The speech was telecast live on almost every news channel, but despite the extensive media coverage, the budget still remains incomprehensible to a majority of the people.
Some of us may eventually learn about the key features of the budget, tax cuts or sops extended to certain sections, but we may not understand the jargon that may have been discussed. The truth is, understanding the budget can be easy. This post will help you to read the budget documents by cutting through the clutter.
The Budget Speech
The budget speech may not be the most entertaining thing to watch on TV. But if you observe closely, you will find that the presentation is organised to the smallest detail. It is divided into three distinct sections.
The first section talks about the Indian economy and its growth prospects for the coming year. During the budget presentation, the Finance Minister said that the Indian economy would recover in the next fiscal with a growth forecast of 7%. However, he mentioned a few major challenges on the global front which could impact growth. These include rise in crude oil prices and increase in interest rates of the US federal reserves.
The second part talks about the government finances and policies such as initiatives to boost investments in the country. The third section deals mainly about taxation proposals. For instance, the Finance Minister revised the tax limits from 10% to 5% for individuals with an annual income between Rs.2.5-5 lakhs.
So this year don’t just focus only on the tax benefits that the government announced. There are quite a few important economic policy changes, which are likely to affect you in the long run. In addition, you should also find out about the new schemes that were announced during the presentation.
Where can you access the documents?
The documents for the Union Budget 2017-18 will be available on the official website: www.indianbudget.nic.in. In addition, you can find the documents on the Ministry of Finance’s website. You can also peruse documents for all the previous year budgets.
How are the documents organised?
In addition to the Finance Minister’s speech, there are fourteen other documents presented to the Parliament. This includes the ‘Key to Budget Documents’ and ‘Budget Highlights’. These documents give a bird’s eye view of the budget to the common man and can be a good place to start.
Important documents to read:
The Budget at a Glance document details the total funds raised by the government and how this money is to be spent in the coming financial year.
The Annual Financial Statement lists out the estimated receipts and expenditure of the government in a comprehensive manner.
Taxation measures proposed by the government will come under the Finance Bill. So provisions related to income tax rates, deductions and rationalization measures can be found in this document.
A Memorandum accompanies the Finance Bill which explains all the different provisions and their effects on the finances of the country.
The Receipts budget offers insight on how the government plans to raise money through different sources.
To find out more about the macro-economic framework of the government, check out the Fiscal Responsibility and Budget Management (FRBM) documents.
The Medium Term Fiscal Policy statement sets out specific limits on the size of the budget deficit. It also discusses the targets for increase in taxes over the financial year.
However, the government has not maintained the deficit targets over the past few years. Go through the document titled Fiscal Policy Strategy in order to understand the government’s efforts to follow fiscal policies set out by the Medium Term Fiscal Policy. It also provides reasons explaining the departures from the targets.
The Expenditure budget details the budget allocations for all the different ministries such as agriculture, atomic energy, commerce, aviation and so on. In addition, you can also find out the amount of funding that is provided to the different government schemes in this document.
Every year, the government announces its financial plan for the country through the Union Budget. Adding the Railway budget into the Union Budget has all the more added to its importance. So it doesn’t matter if you are a student, or a working professional or a retired person. The budget impacts each and every person in the country. Staying updated with the budget and reading the different documents will give you a lot of insight regarding your personal and the nation’s finances.