Authorities asked to meet tax mop up targets: FM
Steps taken to lower govt’s fiscal deficit
With fiscal deficit touching 68 per cent of the Budget estimate in the first half of 2011-12, the Government today said that tax authorities have been asked to make “concerted efforts” to achieve the revenue targets.
Finance Minister Pranab Mukherjee said during the Question Hour in the Rajya Sabha that to contain the fiscal deficit, the government has advised all Ministries/Departments to adhere to the expenditure ceilings in the Budget Estimate 2011-12.
“Instructions have also been issued to concerned Departments to make concerted efforts to achieve the revenue collection targets for 2011-12,” he said. In the Budget, the government had estimated the gross tax collection at Rs 9.32 lakh crore during 2011-12.
The government has set the target of restricting fiscal deficit in 2011-12 to 4.6 per cent of the GDP, as against the 4.7 per cent level in FY 2011. However, with Rs 2.8 lakh crore gap in revenue and expenditure in the first six months of 2011-12, fiscal deficit has already touched 68 per cent of the Budget estimate. During the same period last year, it was Rs 1.33 lakh crore or 34.9 per cent of the estimate.
“Increase in the fiscal deficit during the first half of 2011-12 is due to front loading of direct tax refunds in the current year,” Mukherjee added. He said that the deficit was lower in the same period last year, on account of one time receipt of non-tax revenue from auction of 3G and BWA spectrum. With an aim to contain the deficit, Mukhejree added, the ministries and departments have also been advised to meet additional expenditure requirements, if any, through savings from the overall expenditure outlay.
Replying to a query on additional market borrowing of Rs 52,872 crore during the year, he said it was due to the estimated shortfall in financing the fiscal deficit, mainly on account of shortfall in small savings.
Govt lures investors to small savings
Faced with a shortfall in financing the budgeted 4.6 per cent fiscal deficit for 2011-12, Government, on Tuesday, took recourse to a half page advertisement in national dailies to woo investors in its small saving schemes, the accruals from which can help bridge the gap between its revenues and expenditure.
“Excellent opportunity to invest in Government of India small savings schemes. Higher returns, risk free investment, tax saving benefits,” read the advertisement brought by National Savings Institute, detailing each of the saving scheme, its tax benefits and lucrative return, recently announced by the government. The share of small savings in financing the fiscal deficit has come down significantly in recent times, leading the government to take recourse to market loans.
Finance Minister Pranab Mukherjee said in Rajya Sabha that the extra pressure on fiscal deficit was exerted, mainly due a shortfall in small savings collection.
