Govt invites public comments on changing financial year

New Delhi, August 26

Keen on a wider debate on changing the financial year, the government has sought public comments on the desirability of replacing the existing period in a bid to improve budgetary process and cash management.

The government and most corporate in India follow April 1 to March 31 as the financial year.

A post on mygov site said: “There are many arguments for and against the change in financial year which revolve around issues of Budget and cash management by government, seasonality of government revenues and expenditure, impact of monsoon on Budget forecasting, working season, timelines involved in the legislative cycle of passage of Budget by Parliament...”

It also flagged issues concerning international comparability of fiscal statistics, aligning government’s financial year with year for tax assessment and corporate accounting purposes.

Some arguments are less on the intrinsic merit or demerit of the change and more on the timing of the change, such as when it coincides with other developments impacting businesses, said the write-up, inviting public comments by September 30.

To examine the feasibility of having a new financial year, the government has already set up a committee headed by former CEA Shankar Acharya.

The committee, which will submit its report by December, will have to provide reasoning for the suitability of the financial year from the point of view of correct estimation of receipts and expenditure of the Central and state governments. Pti