The Centre will meet the fiscal deficit target of 3.4% for the current fiscal — as stipulated in the revised estimate of the interim Budget — despite a likely shortfall in indirect tax collection, as expenditure may be lower than estimated, economic affairs secretary Subhash Chandra Garg said on Friday.
“Our assessment at this stage is, in direct taxes, we will probably do as per the revised estimate, in indirect taxes, there might be some shortfall, and on the expenditure side there might be some savings. On the whole, we should be where we are,” he said at an event of the Indian Private Equity and Venture Capital Association.
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Already, fiscal deficit touched 121.5% of the full-year revised target of Rs 6.34 lakh crore by January on account of lower revenue collection. The government had raised expenditure to Rs 24.57 lakh crore in the revised estimate for 2018-19 from the budgetted Rs 24.42 lakh crore. So unless the government resorts to some last-minute expenditure compression or carry forward subsidy payments, the deficit target will be under pressure.
In the current fiscal, direct tax collection is pegged at Rs 12 lakh crore (revised estimate), while GST collection is pegged at Rs 6.43 lakh crore(revised estimate), which is lower than the budgeted target of Rs 7.43 lakh crore.
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Source: Financial Express