The Interim Budget is essentially a budget which is announced in an election year by the incumbent government. The Interim Budget would be applicable until the new government takes over after the General Elections. Hence, unlike the Union Budget, the Interim Budget would be applicable for a part of the financial year. More importantly, there is no provision in the Constitution that prohibits the government from announcing new schemes or making amendments to the taxation in the Interim Budget. However, as per the established parliamentary convention, generally, the incumbent government does not announce new schemes and programmes. Similarly, on the revenue side of the budget, no tax proposals are made. Thus, normally the Interim Budget does not contain the Finance Bill and the Economic Survey.

Even though the words Interim Budget and Vote on Account are used interchangeably, they are not the same. The government needs approval from the Parliament to withdraw money from the Consolidated Fund of India to meet its day-to-day expenses. Hence, the incumbent government presents the Vote on Account in order to seek approval from the Parliament for withdrawing money to meet its expenditure needs until the new government takes over. However, the Interim Budget is an estimate of both receipts and expenditure of the government. The Interim Budget for the financial year 2019-20 had introduced a Vote on Account, wherein the government had sought approval for the expenditure, which was likely to be incurred during April to July, 2019.