Government will Not Change Financial year for Now

Government will Not Change Financial year for Now

The government will not change the fiscal year for now but the issue remains under “examination” and the Budget for 2018-19 will be presented in early February, senior government sources have said.

There are several reasons behind the government not going for an overhaul of the fiscal year from April-March to January-December. There is a view within the government that it would be better to get a sense of revenue receipts after the rollout of the goods and services tax (GST) before going for any major change. The government wants to ensure the system stabilises after GST implementation and a clearer picture of revenue collection appears.

The fact that the economy is emerging from the impact of two large-scale reforms such as GST and demonetisation is also weighing on the minds of policymakers before they embark on another major change.

Changing the financial year would mean a major overhaul of all financial practices that follow the April-March fiscal year and including the tax payments calendar. It would also mean changes for companies and the manner in which they file their results. “The change in fiscal year will not happen this year. The issue is still under examination.

We will see,” said a senior government source. He said that after the presentation of the Budget in early February, the government will examine the issue in detail and arrive at a decision.

The government changed the date for presenting the Budget this year from the last day of February to the first week this year. A panel headed by former chief economic adviser Shankar Acharya was set up to examine the possibility of changing the financial year, which begins on April 1.

Source:-The Economic Times