-Livemint.com Taking into account a likely shortfall in revenue and off-budget spending, the real fiscal deficit could be as high as 5.5% of GDP in the current fiscal Mumbai: As India’s economic slowdown has intensified, so has the debate on whether the government should stick to fiscal consolidation or run a higher deficit to push growth in the upcoming budget, due on 1 February. However, data on revenue available so far suggests that...
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Explained: A new controversy on India's fiscal deficit -Udit Misra
-The Indian Express In his blog, S C Garg, former Economic Affairs secretary, has claimed that the actual fiscal deficit for the last financial year and the current one is more than a full percentage point higher than the official data. On the face of it, India’s fiscal deficit, which essentially maps how much money the Indian government has to borrow to make up the gap between its expenditure and its revenues,...
More »Can a cut in tax rates pull the economy out of the woods?
-The Indian Express A cut in income tax will naturally mean a loss of revenue for the government, which will impact the fiscal deficit. The quantum of the revenue loss will depend on how deep the tax cut is. Finance Minister Nirmala Sitharaman has said that the government is considering cutting tax rates to revive growth. “Tax rate cut is one among the many things we are thinking to boost growth,” Sitharaman...
More »CII suggestion to Revenue Secy: Focus on consumption, investment
-The Indian Express CII recommended adoption of an expansionary fiscal policy to allow fiscal deficit to increase by around 0.5 per cent to 0.75 per cent of GDP, which will give government additional fiscal space of Rs 1.1 lakh crore to Rs 1.6 lakh crore. In a pre-Budget consultation meeting with Revenue Secretary Ajay Bhushan Pandey, the Confederation of Indian Industry (CII) shared its pre-Budget Memorandum recommendations, focusing on providing impetus...
More »Subdued GST collections, lower tax devolution will impact state finances, pose macro risks -Jayanta Roy and Aditi Nayar
-The Indian Express To avoid a substantial fiscal slippage at the state government level, a sizeable expenditure reduction or deferral is likely to be required, given that the borrowing limit set by the central government acts as a soft constraint to the size of the states’ fiscal deficits. There are growing concerns that the two major sources of tax revenues for state governments, the state goods and services tax (SGST) and...
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