Importance of Budget

Importance of Budget :
Union Budget is important because it affects people and economy in general in a number of ways. Taxes are the most interesting part of any budget. Taxes determine the fate of businesses and individuals. The level of disposable income of the taxpayers depends on the tax rates presented in the budget. Government expenditure on various heads such as defence, administration, infrastructure, education and health care etc. affects the lives of the citizens and overall economy. Also, budget is important because Governments use it as a medium for implementing economic policies in the country. Budgetary actions of the Government affect production, size and distribution of income and utilization of human and material resources of the country. Thus, the scope and importance of public finance in a modern economy has undergone an immense change since last 100 years.

Additional Information:

• As per Article 112 of the Indian Constitution, budget presentation is mandatory before a new fiscal year begins. Once presented, the budget will remain valid for the following fiscal year that starts on April 1 and ends on March 31 of the next year.
• As per the resources are limited, it is with the help of an union budget that the government tries to employ them effectively so that the profits can be maximised.
• Another important function is to handle and foresee inflation and deflation. Surplus policies and deficit policies are focused upon during deflation and inflation to keep the economy stable.
• No society is economically equal. It is with the help of  budgetary policies the government tries to brigde the gap between the rich and poor.