Definition
Appropriation Bill
The Appropriation Bill is the law that authorises the government to withdraw money from the Consolidated Fund of India to meet the expenditure approved in the Budget.
After Parliament discusses and votes the demands for grants, the Appropriation Bill legally permits the government to draw the sanctioned amounts from the Consolidated Fund of India. Without it, no money can be spent, regardless of what the Budget proposes.
It complements the Finance Bill: appropriation authorises spending, while the Finance Bill authorises taxation. Like the Finance Bill, it is a Money Bill. Charged expenditures, such as debt servicing, are included in the appropriation even though they are not put to a vote.
Related terms
- Consolidated Fund of IndiaThe Consolidated Fund of India is the government's main account into which all revenues, loans raised and recoveries flow, and from which most expenditure is drawn only with Parliament's approval.
- Vote on AccountA vote on account is Parliament's approval for the government to draw money for essential expenditure for a few months until the full Budget is passed.
- Finance BillThe Finance Bill is the legislation introduced with the Budget that gives legal effect to the government's tax proposals for the coming year.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.