Growth to get priority over fiscal prudence, indicates govt official
The Indian Express
ENS Economic Bureau
“Fiscal prudence is
important, but growth should take precedence,” the official, who did not wish
to be named, said, adding that growth will be the priority.
With economic growth rate slowing
down and revenue targets looking out of reach, the government has indicated
that it’s focus would rather be on reviving growth than fiscal prudence, a hint
that it could overshoot this year’s fiscal deficit target of 3.3 per cent of
GDP, a senior Finance Ministry official said on Wednesday. “Fiscal prudence is important, but
growth should take precedence,” the official, who did not wish to be named,
said, adding that growth will be the priority.
The government is looking at how much
space it has within the Fiscal Responsibility and Budget Management (FRBM) Act
for a possible fiscal slippage, the official added. The NK Singh committee on
FRBM had proposed an escape clause wherein the fiscal deficit could be
marginally relaxed by up to 50 basis points to bring in structural reforms. The
comments come as the government’s revenue targets for both direct and indirect
taxes are lagging behind the budget estimates by a wide margin. The Revenue
Department under the Finance Ministry had earlier this week exhorted both
direct and indirect tax officers to achieve targets without troubling the
taxpayers. With only four months left to meet the overall target, Goods and
Services Tax (GST) target has been set at Rs 4.55 lakh crore (Rs 1.10 lakh
crore for three months each and Rs 1.25 lakh crore in one month), while direct
tax officials have to collect Rs 7.78 lakh crore during the same period.
As per latest data, the fiscal
deficit had overshot the full-year target to 102.4 per cent of the full year
target in April-October, the first seven months of this financial year, itself.
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