News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Budget Extravaganza »
 How to reduce your income tax outgo with Budget 2019 provisions
 How your taxes and investments could be affected by the budget
 Here is what you got to pay Interim Budget 2019 Tax Calculator
 Income tax changes introduced by the BJP govt in the past 5 budgets
 Will your salary structure change once again? Budget 2019
 Budget 2019: Big relief to middle class likely, tax exemption might go up to this limit
 Will Budget 2019 be startup friendly? Know what major reforms can take place; from tax structure to reducing MAT
 Will interim Budget 2019 reduce your tax?
 IT exemption threshold may go up in interim Budget
 Ficci for cut in corporate tax rate in Budget
 Can You Expect Income Tax Changes In Budget? Here's What Experts Say

Govt starts biggest ever overhaul of Budget
September, 26th 2016

The finance ministry set in motion the most comprehensive overhaul of the Budget exercise in independent India, as it issued the Budget circular on Thursday evening. The circular is the starting point of preparations of the Budget.

The 2017-18 Union Budget is likely to be read on the last day of January, instead of the last day of February. It will also be the first one in which the railway Budget and the general Budget will be merged.

The circular said there would be no five-year plans after April 1, 2017 when the 12th five-year Plan comes to an end, justifying the need for doing away with Plan and non-Plan expenditure. There will only be revenue and capital expenditure classifications in the Budget.

"The reclassification of expenditure under accounting heads will start from Budget 2017-18 and after the 12th Plan period (2012-17) comes to an end," the circular noted.

Keeping an eye on early presentation of the Budget, meetings for fixing revised estimates would start from October 17. It should be noted that date of the presentation of the Budget has not been fixed yet, though the Cabinet has given its in-principle approval for the same.

With the phasing out of Plan/non-Plan classification, the finance ministry is overhauling the way it funds and monitors centrally sponsored schemes and disburses money to various government departments.

"The focus would be on top-down budgeting where the resource priorities are guided by medium- and long-term strategies. The yearly sectoral priorities and allocations would also be set accordingly. Based on the medium-term allocations under the Medium Term Expenditure Framework statement, the ministries would set a outcome/output framework," the statement noted.

This means, expenditure targets will be on a rolling basis, where the spending for any upcoming year will be decided upon spending in the current year. Instead of deciding spending on schemes based on the amount of money needed to be spend (input), it will now be decided upon targeted outcomes, which will be quantifiable in nature.

"There is also an endeavour to move towards giving ministries maximum flexibility to re-appropriate amongst schemes and components of expenditure within a scheme, required to maximise the achievement of the agreed objectives," the circular said.

The advancement of the timelines means that the final upper ceilings for the centrally sponsored schemes will be decided by mid-January.

The central government's spending will now be divided into some broad categories. Establishment expenditures will be the administrative spending of the Centre, which will include salaries, medical expenses, wages, overtime allowances, travel expenses, office expenses, materials and supplies, training, among others. Expenditure on central sector schemes will include all those schemes which are entirely funded and implemented by the central government.

Other kinds of central expenditure will include spending on state-owned companies, autonomous bodies, etc. Finance Commission transfers will only come in the demand titled 'transfers to states'. The category 'other transfers to states' will include all other transfers to states such as those made under the National Disaster Relief Fund, and assistance under similar schemes.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2019 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Careers

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions