Vote on Account is a grant in advance to enable the government to carry on until the voting of demands for grants and the passing of the Appropriation Bill and Finance Bill.
This enables the government to fund its expenses for a short period of time or until a full-budget is passed. As a convention, a vote-on-account is treated as a formal matter and passed by Lok Sabha without discussion.
Vote on Account was frequently used until 2016 when the Budget was presented on the last working day of February. However, since 2017, the budget presentation date was advanced to February 1. This helped the executive to use almost 2 months time to get the full-budget passed in the same financial year. So, since 2017, Vote on Account is not usually used as part of the government budgeting process, unless in special cases like an election year.
Difference between Full Budget and Vote on Account
- Full Budget deals with both expenditure and revenue side but Vote-on-account deals only with the expenditure side of the government’s budget.
- The vote-on-account is normally valid for two months but a full budget is valid for 12 months (a financial year). As a convention, a vote-on-account is treated as a formal matter and passed by Lok Sabha without discussion.
- But passing for budget happens only after discussions and voting on demand for grants. A vote-on-account cannot alter direct taxes since they need to be passed through a finance bill.
- Under the regular Budget, fresh taxes may be imposed and old ones may go. As a convention, a vote-on-account is treated as a formal matter and passed by the Lok Sabha without discussion. But the full budget is passed only after discussions and voting on demand for grants.
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