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Desirability and Feasibility of Changing the Financial Year

Desirability and Feasibility of Changing the Financial Year
Start Date :
Aug 24, 2016
Last Date :
Oct 01, 2016
00:00 AM IST (GMT +5.30 Hrs)
Submission Closed

The Government of India has appointed a Committee chaired by Dr. Shankar Acharya, former chief economic adviser, to examine the desirability and feasibility of having a ‘new ...

The Government of India has appointed a Committee chaired by Dr. Shankar Acharya, former chief economic adviser, to examine the desirability and feasibility of having a ‘new financial year’. Other distinguished members of the Committee are Shri K M Chandrasekhar, former Cabinet Secretary, Shri PV Rajaraman, former Principal Finance Secretary, Tamil Nadu and Dr. Rajiv Kumar, Senior Fellow Centre for Policy Research.

Presently, the financial year followed by governments in India runs from 1st April to the following 31st March.

This issue was last examined by the L K Jha Committee in 1985, whose recommendation to move to a financial year of January 1- December 31 (for Central and State Governments) was then not accepted by the then Government.

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 the Parliament, 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 but rather on the timing of the change when the change coincides with other developments impacting businesses.

This Discussion Forum seeks to invite inputs from everyone interested in this issue.

We welcome your comments, suggestions, information and documents on the Committee’s Terms of Reference and issues related to it. Please provide these latest by 30th September, 2016.

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Showing 816 Submission(s)
Krishna Kumar Pande
Krishna Kumar Pande 9 years 10 months ago
It is high time we move from March budget to a December budget and all accounting be done for the year end when we are following a Jan-Dec calendar year. Further budgets expenditure should be spent on a quarterly basis and there should be restriction of not releasing budgets in last quarter with only money spend on planned programs till end September Today majority is funds are spent in the last month
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Hemant Indian
Hemant Indian 9 years 10 months ago
We indeed need a new financial year which is in sync with calendar year 1st Jan-31st Jan because having it from Apr-Mar does not make sense unless it has some huge economical benefit to the country. "Let's keep it simple." Simplicity is the new mantra of staying ahead. So, yes 1 more vote in favour of 1st Jan-31st Jan. Achintya Das rightly said, tax should he adjusted accordingly.
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Suresh Verma
Suresh Verma 9 years 10 months ago
Financial year should be linked with new year to avoid confusion between financial year and calendar year. Another option could be as per Hindu practice of starting financial year with reference to Deepawali
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Achintya Das
Achintya Das 9 years 10 months ago
This is always desirable to have only one year, be it financial and fiscal as also recommended by previous committee. The year it will be implimented, fiscal year will be shorter by 3 months while next year it will be longer by 3 months. So tax rebates limit need to be adjusted accordingly for those two years i.e. reduced by 75% in the 1st year and increased to 125% in next year so that tax payers neither get extra benefits nor punished in those two years because of this historical change.
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Veer Sardesai
Veer Sardesai 9 years 10 months ago
Financial year should be changed to calendar year across all government institutions for ease of accounting. Eg RBI stipulates a amount that can be spent by a resident per calendar year while income tax follows the financial year.If both followed the same "year" accounting & following rules will be much easier.
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Shrikant R Karode
Shrikant R Karode 9 years 10 months ago
The financial year of Government and all organisations should be changed to January-December cycle. It will give two major benefits international alliance and budgeting after rainy season. It should be implemented at the earliest say by January 2018.
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GUNJAN MODI
GUNJAN MODI 9 years 10 months ago
Agriculture is main part of Indian Economy, So while considering an upgradation in change in Financial Year, Crop cycle should be considered. If we keep Crop Cycle as a reference, then I think this would help making decision more accurately. And Almost all Indians won't have any Problem If Crop Cycle is kept as reference. #financialyear #economicaffairs #mygov
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SHIVABASAWA UDNUR
SHIVABASAWA UDNUR 9 years 10 months ago
Honurable PM Modiji, n Advisory Members, I strongly recommend to change the financial year on simple pretext that the existing FY beings on Fools Day n will followed n Fooled. In Business n Accounting Years also commences on April 1st which also Fools Day which is not consonace with good ethics of busines/ intent. Our culture is to begin work on Shubawasar so that rest of year is full of light n happiness. Hence apart form April Fools day is good. Thanking you. Shivabasawa B Udnur.
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