Press Trust of India
New Delhi, Feb 29: Amid debate over balancing growth and financial management, Finance Minister Arun Jaitley Monday adhered to the fiscal consolidation roadmap by proposing to keep the deficit at 3.5 per cent of GDP in 2016-17. He also assured that development agenda will not be compromised and a committee would be set up to review the working of Fiscal Resposibility and Budget Management (FRBM). The fiscal deficit in current fiscal has been estimated at 3.9 per cent, which will be brought down to 3.5 per cent in next fiscal.
Total government expenditure in next fiscal would be Rs 19.78 lakh crore. Of this, Rs 5.50 lakh crore would go towards Plan expenditure and another Rs 14.28 lakh crore towards non-Plan expenditure. The revenue Deficit for current fiscal has been bettered to 2.5 per cent of GDP, from the budgeted 2.8 per cent. Jaitley further said that in view of the uncertainty and volatility in global markets, time has come to review the FRBM Act. A committee to review the implementation of FRBM would be set up, he said, adding that the government will also work with the state governments towards doing away with the distinction between plan and non-plan expenditure.
12 pc rise in tax revenue seen in FY17
Gross tax revenue is estimated at Rs 16.3 lakh crore for 2016-17, which is around 11 per cent higher than revised gross tax revenue of Rs 14.5 lakh crore for the current fiscal. As per the Budget documents, the government estimates gross tax revenue of Rs 16,30,888 crore in 2016-17 against revised gross tax revenue of Rs 14,59,611 crore in the current fiscal year — a growth of 11.73 per cent. The government also estimates non tax-revenue to rise by 24.88 per cent to Rs 3,22,921 crore in 2016-17 from Rs 2,58,576 crore in the ongoing fiscal year. Indirect tax, which includes customs, excise duties and service tax, is projected at Rs 7,79,670 crore for next fiscal against Rs 7,03,642 crore (revised estimate) for the current fiscal year. Direct tax collection which includes corporation tax, income tax and wealth tax is estimated to rise by 12.64 per cent to Rs 8,47,097 crore in next fiscal year from Rs 7,52,021 crore in 2015-16.
Lower borrowing cheers bond market
Government will borrow Rs 4.2 lakh crore from the market in 2016-17, down from Rs 4.4 lakh crore in the current fiscal. The budgeted target for borrowing in current fiscal was Rs 4.5 lakh crore, but the government will raise only Rs 4.4 lakh crore from the markets, as per the Budget papers presented by Finance Minister Arun Jaitley in Parliament Monday. “By containing fiscal deficit for next fiscal at 3.5 per cent, we have ensured that the borrowing from the market is kept at the minimal level. It’s Rs 4.2 lakh crore,” Economic Affairs Secretary Shaktikanta Das said. However, gross borrowing has been pegged at Rs 6 lakh crore up for 2016-17 up from Rs 5.8 lakh crore in the ongoing fiscal.
