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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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All Comments

Showing 816 Submission(s)

jeeju narikkalathil 9 years 1 week ago

I too feel that we change the current financial year to annual year mode.

Parag Barjatiya 9 years 1 week ago

This would be too good and amazing. This would simply a lot of things. I would really like to see this as a reality.

SANJAY KAPOOR 9 years 1 week ago

India was a predominantly agricultural economy in 1947 hence looking to monsoon and winter crops the policy of fiscal budgeting was followed for a better collection based on economic conditions. Now in 21st century we are moving more towards services based economy and due to which share of Agro economy is shrinking.
Hence now we can move towards aligning ourselves with global fiscal year I.e. Calendar year.
One time systems adjustments would be required like Y2K which India is capable of.

Jayakumar V 9 years 1 week ago

This is welcoming move. Why should there be a financial year and annual year different? This can be made uniform. It is very sensible to start the financial year matching with calendar year. This makes all process uniform and easy to follow. There will be initial hurdle for one year but can be overcome in due course.

Kamlesh Gupta 9 years 1 week ago

There should be uniformity everywhere it dose not matter that it should match with calendar year or not, Every department and throughout Country should follow uniform financial year. With uniformity it would be easy to understand, analyse the data available. For taking prudence it will be very helpful. also manipulation of figures can be curbed with uniformity.

Govindram Sharma 9 years 1 week ago

GOVT. HAS TAKEN A WISE STEP IN RIGHT DIRECTION APPOINTING AN EXPERT COMMITTEE , AND EXPERTS WOULD TAKE IN TO ALL ASPECTS IN THIS REGARD. COMMITTEE WOULD CONSIDER THE PROBLEMS OF EXISTING SYSTEM AND BENEFIT FROM THE PROPOSED FINANCIAL YEAR AND THE CHOICE SHOULD BE OF BETTER ONE WITHOUT PREJUDICE. WE SHOULD HAVE THE APPROACH TO ACCEPT THE RIGHT.

Bandaru Satyendra 9 years 1 week ago

Very most important change that India needs at this point of time i.e both Calendar year and Financial year should be same. Government should also contemplate to introduce Academic year also in January and all higher studies should have two intakes in a year like all other developed countries. We can not afford to remain forever as developing country. Please this change will definetly bring lot of positive image for Respected PM, Government and BJP party

Vijay Kumar Agrawal 9 years 1 week ago

It must be in consonance with international year that is calendar year Jan art to December.

udaya 9 years 1 week ago

If u done like that the entry monsoon session will become Budget session

Akhilesh Singh_14 9 years 1 week ago

I think the Financial Year should remain from 1st April to 31st March, because it is connected with Hindu Calendar, which normally starts in March/ April. However, it is suggested that date of presentation of Budget in Lok Sabha may be in November/ December so that the amendments get assent of the Hon'ble President and the same may be enacted from 1st April. Now various provisions are made applicable and connected with enactment of Finance Act (Budget), which normally takes place in May.