InvestorQ : Why is the Budget called the Union Budget?
Anjali Desai made post

Why is the Budget called the Union Budget?

1 year ago
In the Indian Constitution, Article 112 defines the Union Budget, also referred to as the Annual Financial Statement, as a statement of the estimated receipts and expenditure of the Indian government for that year. Overall, the Union Budget keeps the account for the Indian government’s finances for a single fiscal year that runs from 1st April to 31st March. Within the Union Budget, it is classified between two heads: Revenue Budget and Capital Budget.

However, the term ‘Union Budget’ was given because of how the independent state of India was formed. In essence, any country is made up of two main entities; federal states and the central government. In India, the highest power is given to the central government with the responsibility to govern the Union of States (28 states and 8 union territories). Since the central government has to form a budget that directly affects the financial situation of the other states and UTs, it is the sole creator of the budget.

As, in the Indian Constitution, the center is termed as the ‘Union’, the budget created by the central government (the finance ministry) and presented by the Finance Minister is called the Union Budget. A budget that is to financially unite the Indian states and UTs for holistic development and governance of India. Apart from the Union Budget and based on its announcement, the Indian states also create and present their State Budgets.