Union Budget 2023: GDP to Economic Survey & more; Annual budget terminology decoded

On February 1, the Union Budget for 2023–24 is scheduled to be presented in Parliament by Finance Minister Nirmala Sitharaman. As eagerly as the nation waits for the budget, many of us struggle to comprehend the important concepts we hear when listening to the budget speech or even while reading about the budget. 

Let's explore these straightforward yet crucial budgeting terminology so that we may better grasp the Union Budget when it is released.

1. Tax revenue: It is the sum of money that is gathered by taxation of your earnings, purchases, and profits, among other things. The majority of the government's income comes from taxes.

2. Direct Tax: A direct tax is one that a person pays to the government directly, as the name implies. Both income tax and corporation tax are present in this.

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3. Fiscal Deficit: The gap between the total revenue and total spending of the government is referred to as the fiscal deficit. In layman's terms, the deficit is what happens when the government spends more money than it brings in over a given year.

4. Revenue Deficit: The revenue deficit is the discrepancy between the total amount of money the government receives through taxes and other sources and the amount it spends on daily operations. When a revenue shortfall occurs, the Centre is forced to borrow money to make up the gap.

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5. Indirect tax: Indirect Tax is the amount of money that citizens pay to a person, organisation, or other body that is responsible for paying taxes to the government. For instance, if you purchase a product from a seller, the vendor is required to remit tax to the government on your behalf. The dealer may, however, afterwards charge you for that tax in the form of GST, which is then deposited by the Indian government. As a result, you are now a taxpayer indirectly.

6. GDP: You've probably heard the term gross domestic product (GDP) numerous times. The monetary worth of all products and services purchased by the end user and generated domestically over a specific time period is calculated as the gross domestic product (GDP).

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7. Inflation: The phrase "inflation" is rather simple to comprehend. Simple price increases constitute inflation. It refers to the pace of increase in a country's economy's prices for products and services.

8. Customs Duty: The government imposes a set amount of tax on the transaction amount when importing or exporting goods from India. While the importer, exporter, or other organisation is ultimately responsible for paying the customs duty, it may also occasionally be passed on to the consumer.

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9. Economic survey: It reveals the nation's economic trends. The Survey examines changes in areas such as infrastructure, employment, money supply, imports, exports, agricultural and industrial production, and any other pertinent economic aspects that affect the Budget. It arrives in Parliament one day before the budget for the upcoming fiscal year.

10. Finance Bill: A finance bill is one that deals with the nation's finances, including taxes, spending, borrowing, and revenues. All of these are included in the Union Budget, which is approved as a finance bill. It makes the government's financial plans effective.

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