This is primarily a finance minister's statement to seek Parliament's approval of the obligatory expenditure that the government has to incur for the first three or four months of a financial year. So, a vote-on-account gives you an idea of the tax compliance, tax buoyancy in different segments of the economy and of the effectiveness of the policies to mobilise tax as well as non-tax revenues. This sanction of Parliament for withdrawal of money from the Consolidated Fund of India to meet the government's expenses is generally known as a vote-on-account.
Normally it is used by a caretaker government or in the polling year. It typically opts for a vote-on-account, as it is regarded improper for an outgoing government to impose on its successor changes that may or may not be acceptable to the incoming government.
While a vote-on-account deals only with the expenditure side of the government's budget, an interim Budget is a complete set of accounts, including both expenditure and receipts.
Normally, the vote-on-account is taken for two months only. But during election year or when it is anticipated that the main Demands and Appropriation Bill will take longer time than two months, the vote-on-account may be for a period extending two months.
Typically this period does not exceed six months, as that is the maximum gap possible between two sittings of the Parliament.
Normally a vote-on-account is in operation till the full Budget is passed.
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