Fiscal year may be changed from 2018; Budget in Nov?
Come 2018 and the financial year in India could commence from January instead of April as the Centre appears set to make the historic transition to end the 150-year-old tradition.
Accordingly, the next Budget could be presented by the Centre in November this year, high-level government sources hinted on Monday.
The sources said the government is working on aligning the financial year with the calendar year after Prime Minister Narendra Modi pitched for a change.
This would be another historic change after advancement of the Budget presentation to February 1 this year, ending the decades-old practice of presenting the annual exercise in the last week of February.
According to the proposal under discussion, the Budget session of Parliament would have to be held well before December so that the budgetary exercise can be concluded by the year-end.
Since it takes nearly two months for the conclusion of the budgetary exercise, the possible dates for holding the Budget session could be the first week of November, the sources said.
The financial year from April 1 to March 31, currently in vogue nationally, was adopted in 1867 principally to align the Indian financial year with that of the British government.
Till then, the financial year in India used to commence on May 1 and end on April 30 of the following calendar year.
The government had last year appointed a high-level committee to study the feasibility of shifting the financial year to January 1. The panel submitted its report to the Finance Minister in December.
Among the various factors, a NITI Aayog note had said that a change in the financial year was required as the current system leads to sub-optimal utilisation of working season.
It had also noted that the current financial year cycle was chosen without any reference to national culture and traditions or convenience of legislators.
A few months back, the Parliamentary Standing Committee on Finance also recommended shifting the financial year to the January-December.