Budget Session of the Parliament is soon going to start and before that, here are a few basic facts about the Union Budget, which is being seen as extremely crucial for the Narendra Modi government. Budget is the annual financial statement, which lays out the governments taxation proposals and expenditure plans for the fiscal.

The Union Budget consists of two aspects — the Revenue Budget and the Capital Budget. The Revenue Budget entails the revenue of the government, mainly from taxes and other sources. The Revenue Budget also looks at the day-to-day expenditure of the government. The Capital Budget entails capital receipts, which cover the loans the government raises and capital payments, which include government expenditure on acquisition of assets.

Usually, the finance minister will present the general budget before the start of the financial year. With the Union Budget scheduled to be unveiled by finance minister Arun Jaitley on February 29, the budget sessions for various categories are as follows.

• The budget session of Parliament will begin on Feb. 23
• The Rail Budget will be presented on Feb. 25 and
• The Economic Survey on February 26.

The Economic Survey indicates the direction of the budget and highlights the country’s economic performance.

Highlights of Previous Budgets of the Modi Government:

The Union Budget 2014-15 was the first budget to be presented by the current government after Narendra Modi came to power in May 2014.

The previous two Union Budgets saw the Narendra Modi government, in a bid to boost investment and economic growth, offer incentives to businesses.

• One of the major highlights of Arun Jaitley’s 2014 budget was the increase in tax exemption limit to Rs 2.5 lakh, and for investment under Section 80C to Rs 1.5 lakh. The Modi government also raised the cap on foreign direct investment (FDI) in the defence and insurance sectors to 49 percent each.
• In Budget 2015, the government made 100% deduction for contribution to Swachh Bharat and Clean Ganga projects, service Tax rate hiked to 14%, from 12.36%, and incentivized use of credit, debit cards. Implementing the Goods and Services Tax, however, remains one of the promises that the government still has to deliver.
• The government raised the tax devolution to states to 42% of the divisible pool from 2015-16 to 2019-20, and also hiked excise duty on cigarettes and tobacco products. Tax slabs were unchanged, and the government abolished wealth tax.
• The government last year also launched a savings scheme for the girl child, Sukanya Samriddhi Account Scheme, which gives 9.2 per cent interest rate for 2015-16 on principal of up to Rs 1.5 lakh. This savings scheme provides tax exemption on interest component also at the time of withdrawal. This is a long-term savings scheme, with the amount maturing when the daughter turns 21.
• The government launched gold bond scheme and gold monetisation scheme to turn idle gold holdings of citizens into productive use. These schemes, which are yet to attract large number of investors, seek to do away with the need to hold physical gold.

And this year, the government is expected to move from its pro-infrastructure approach to focus on social welfare. We need to wait for some time to know the budget details of this year and what changes would happen this time.