Budget Gurukul: Understand the Complete ABCD of Budgeting… Know the meaning of each letter

The general budget of the country is not much time left, so if you too want to brush up on your budget knowledge, then we bring you the complete ABCD of Budget.

The current government is going to present the last full budget this year. The country’s finance minister Nirmala Sitharaman is likely to make several new announcements in the budget on 1 February 2023. There may also be some changes in the tax slabs. But before that, let’s brush up on your budgeting knowledge. In this, you will understand the complete ABCD of budgeting, where you will know the meaning of each letter…

Annual financial statements from A

On the day of the budget, the finance minister placed 10 papers in the parliament. The most important of these is the annual financial statement. In this paper, the government details its income and expenditure throughout the financial year.

Estimate the budget from B

During budget speeches, you will hear the term budget estimate repeatedly. In its budget, the government allocates a certain amount for the next financial year to each ministry or department or plan. It is the estimated expenditure of the ministry or department which is called budget estimate in English.

C to current account deficit

When the Finance Minister gave information about the import and export of the country during the budget speech, he also spoke about the difference between the two. In such a situation, when the country’s import bill is more than the export, it means that the country’s current account deficit is reported to the parliament.

D to disinvestment

The term has become essential in budget speeches in the last few years. Every year the government sets investment targets as its main source of revenue. This is called disinvestment. It simply means, whenever the government sells some or all of its stake in a company, it is called an investment.

  • However, another term direct tax from D is also used in the budget. It is mainly used for income tax or corporate tax.

Economic survey from E

In the budget, the government details the income and expenditure of the coming year. But the Economic Survey was tabled in Parliament just a day before the Budget was presented. It mainly mentions the trends of the country’s economy and the government’s efforts in the past year. In a way it is a review of the previous budget of the government.

Money bill from F

In English it is called Finance Bill. The proposals in the budget, especially the new tax provisions, must be enacted into law. The government brings it in the form of a money bill on which Parliament gives its seal.

  • Another term fiscal deficit is used in the budget. In English it is called fiscal deficit. It shows the difference between government income and expenditure. When expenditure is greater than income, the government is in deficit, that is its fiscal deficit.

G to GDP

Apart from the budget, this term is heard many times. The full form of GDP means Gross Domestic Product, in English it is called Total Domestic Product. It simply means the value of all goods and services produced within a country in a year. It is useful for measuring the economic growth of the country.

H to HNI

Big corporates like Ambani-Adani or cricketers or film stars who earn a lot of money are called High Income Individuals (HNIs) in finance parlance. To reduce the tax burden on the poor, the government levies a little extra tax on HNIs. This tax is levied as a surcharge on income tax.

I am indirect

A tax that the government doesn’t take directly from you, but you have to pay on some goods or services. This is called indirect tax i.e. indirect tax. Just like you pay GST on many goods or services. It is an indirect tax.

  • One more word from me on the budget. This is inflation. In the recent past this one word has caught the nose of the majority of the population of the country.

Jargon from Jay

The finance minister used a lot of heavy words in his budget speech. They are very difficult for common people to understand, but financial sector experts understand them very well. These difficult words of budget are explained in simple language in the news, like this ABCD of budget… these difficult words are called jargon. Nirmala Sitharaman often targets her opponents by saying that she minimizes the use of business jargon.

K to K-shaped recovery

After Corona, the improvement of the country’s economy has been given a new name as K-Shaped Recovery. It means the state of the economy where it is improving, but it is not in the right direction. In a situation where a large population is unemployed, a few rich people make a lot of money from the stock market.

Long term capital gain from L

The government imposes a tax on capital gains in the budget. It means making a profit in the current financial year by selling an old investment or asset. Suppose you bought gold worth Rs 1 lakh, which sold for Rs 4 lakh this year. That means you got profit on your capital. So when this profit is in long term it is called long term capital gain, in short term it is called short term capital gain.

Minimum option tax from M

Companies that are not subject to income tax and do not pay any tax. The government has fixed minimum alternative tax to collect tax from them.

N to Non-Plan Expenditure

In the budget, the government divides its expenditure into two parts. One part is plan expenditure and the other is non-plan expenditure. Non-plan expenditure is the expenditure of the government from which nothing productive is achieved. This includes salary, pension, subsidy and interest etc. Where expenditure on planning or infrastructure expenditure of the Ministry comes under plan expenditure.

Result budget from O

The amount paid by the government for expenditure in the budget. What has been achieved by the ministry, department or the government as a whole? The practice of estimating this is called outcome budgeting. It is a kind of progress report of government activities.

Public Accounts from P

People in India invest big in small savings schemes, from post offices to public provident funds. The government keeps it in a separate account and uses it as it sees fit. But this amount is not actually from the government, rather it has to be returned to the people who deposited it in the savings scheme. This account of the government is called public account.

Quarterly Review from Questions

In India, GDP is reviewed every three months of the financial year. It shows the direction the economy is going. This is called quarterly review.

Revenue deficit from R

Fiscal deficit in simple terms, deficit occurs when government’s revenue expenditure exceeds its revenue revenue. It occurs when the revenue revenue of the government is not equal to the revenue projected in its budget.

Securities transactions from s

When you buy and sell shares, derivatives, mutual fund units etc. listed in the stock market, the tax that the government collects from you is Securities Transaction Tax.

T from Treasury Bills

When the government collects money from the market for a short period of time, it issues treasury bills. Its maximum maturity period is 364 days.

U to Union Budget

The budget presented by the central government is actually called the Union Budget. It is defined in Article 112 of the Constitution of India. In general language it is called general budget.

V to VAT

However, after the introduction of GST, this indirect tax has been removed from most of the items. But this tax is still levied on products like petrol and diesel. This tax is levied on the difference between the cost of production of an item and the value of the item produced. It is called value added tax.

Wealth tax from W

India has not yet introduced such a tax, but it is often discussed. This tax is related to rich people. This tax is imposed on luxury goods and those who have enormous wealth.

Z to Zero based budgeting

Also read this

A budget that starts from scratch. It means that in this type of budget, the remaining money of the previous budget is not carried forward.

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