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The Finance Bill also referred to as the “Act for Appropriation of Funds for Appropriations,” is a law that details the sum of money that the Government of India will spend and how it will be spent. Bills classified as financials deal with fiscal matters including revenue and expenditure. The Constitution does, however, use the term “finance bill” in a technical meaning.
The Union Budget’s Finance Bill outlines all the legal modifications required for the proposed tax adjustments by the Finance Minister. The Financial Bill is an important part of Indian Polity which an important subject in UPSC Syllabus. Students can also go for UPSC Mock Test to get more accuracy in their preparations.
Financial Bill Meaning
According to Article 117 of the Indian Constitution, financial bills are those that deal with financial issues but are not money legislation. The remaining categories of financial bills are financial bills (i) and (II). The decision as to whether or not the Bill is a Money Bill rests with the Speaker of the Lok Sabha.
The Speaker’s decision shall also be deemed final. A finance bill outlines the sum of money the Indian government plans to spend as well as the manner in which it will be spent. A finance measure is a piece of legislation that deals with money and deals with things like inflation, interest rates, and tax relief. Since it is a financial bill, any member of either house of Parliament may introduce it.
Financial Bill Feature
A fairly accurate picture of a nation’s finances is a finance bill, which is an account of what is paid and what is received. This receipt details the transaction between the two parties, in this instance, the bilateral trade between the two nations. This is a written request for goods delivered by one party to another with the guarantee that payment will be made in full or by a specific date.
Also Read: Money Bill
Financial Bill Types
Financial bills (I) Article 117 (1)
A Financial Bill (I) is a piece of legislation that incorporates additional general legislative provisions in addition to any or all of the topics listed in Article 110. For instance, a law that includes a section on borrowing but is not entirely focused on borrowing. A money bill and a finance bill (I) are similar in that both can only be introduced in the Lok Sabha and not the Rajya Sabha, and both can only be introduced on the president’s recommendation.
In all other aspects, the legislative process for a finance bill (I) is the same as that for regular bills. It can therefore be rejected or changed by the Rajya Sabha, with the exception that no amendment—other than one that lowers or abolishes taxes—can be introduced in either House without the president’s approval. If the two Houses cannot agree on such a legislation, the president may call a joint session of the two Houses. This will end the impasse. When the measure is presented to the President, he has three options: to approve it, to reject it, or to send it back to the Houses for further deliberation.
Financial bills (II) Article 117 (3)
A financial bill (II) does not contain any of the items listed in Article 110, but it does contain measures impacting Consolidated Fund of India spending. It is regarded as an ordinary bill and is handled in every way by the same parliamentary process as an ordinary bill. This bill’s only unique feature is that it cannot be passed by either House of Parliament unless the President has asked for that House to take the proposal under consideration.
As a result, the President’s consent is not necessary for the filing of finance bill (II) in either House of Parliament. In other words, the President’s proposal is required during the consideration stage but not during the introduction stage. Either House of Parliament has the option to accept it or change it. The President may call a joint session of the two Houses if they cannot agree on such a measure. This will end the impasse. When the measure is presented to the President, he has three options: to approve it, to reject it, or to send it back to the Houses for further deliberation.
Also Read: Public Accounts Committee
Finance Bill Significance
The Finance measure is important for Indian politics and government since it is a measure that discusses all the important concerns that the nation must solve, particularly those that relate to spending. This measure addresses issues like tax relief, inflation, interest rates, and other things. Additionally, it discusses how political parties founded on similar principles are supported electorally. From this law, the government previously passed a number of significant Acts, including the Right of Citizens Act (RC), the Company Law Amendment Act (CLAA), the First Information Report Act (FIRAA), and others.
Financial Bill Need
The Union Budget proposes a number of tax changes for the upcoming fiscal year, even though not all of the adjustments are included in the Finance Minister’s Budget address. A variety of current laws in the nation that handle different taxes will be impacted by these suggested modifications. The Finance Bill seeks to change each pertinent piece of legislation without necessitating the passage of a separate amendment bill for each one.
Since it addresses all of the major issues that the nation must resolve, particularly those pertaining to expenditure, the Finance Bill is essential for Indian politics and government. With this statute, a lot of issues are addressed, such as tax relief, inflation, and interest rates. Election support for political parties founded on such issues is also covered.
As a result of this law, the government has already implemented numerous significant Acts, including the Right of Citizens Act (RC), the Company Law Amendment Act (CLAA), the First Information Report Act (FIRAA), and many more. For instance, a Union Budget’s anticipated tax modifications may require amending various sections of the Income Tax Act, Stamp Act, Money Laundering Act, and other legislation. The Finance Bill makes the necessary changes to or repeals the current laws.
Financial Bill UPSC
Both a Finance bill and a Money bill were introduced into our parliament during the period of India’s independence. Financial Bills are governed by Articles 117(1) and 117(2). Financial bills come in various forms, but not all financial invoices are money bills. Since then, it has been put to use in numerous applications. The country’s maintenance depends on the finance bill, and our government depends on the money bill. Students can read all the details related to UPSC by visiting the official website of StudyIQ UPSC Online Coaching.