FY22 fiscal deficit improves to 6.7%

„Higher tax mop-up helps govt narrow gap

The country’s fiscal deficit for fiscal year 202122 improved to 6.71 per cent of the GDP over the revised budget estimate of

6.9 per cent, mainly on account of higher tax realisation.

According to the Controller General of Accounts (CGA), the fiscal deficit in the absolute terms was Rs 15,86,537 crore (provisional). The finance ministry in February had estimated the deficit at Rs 15,91,089 crore or 6.9 per cent of GDP.

However, the tax receipts came in higher at Rs 18.2 lakh crore against the revised estimates (RE) of Rs 17.65 lakh crore. The total expenditure too was higher at Rs 37.94 lakh crore against the RE of Rs

37.7 lakh crore presented to Parliament on February 1, 2021.

The CGA further said the revenue deficit at the end of the fiscal was 4.37 per cent for fiscal 2021-22.

In another set of data, the CGA said the fiscal deficit during the first month of 2022-23 was 4.5 per cent of the Budget Estimate for the current fiscal.

The deficit was 5.2 per cent in the year-ago period. The government expects the fiscal deficit for the current financial year at 6.4 per cent of GDP or Rs 16.61 lakh crore.

In April 2022, there was a revenue surplus of Rs 591

crore. Government meets its fiscal deficit from market borrowings.

Commenting on the data, Vivek Jalan, partner, Tax Connect Advisory, said the revenue collections were around Rs 27 lakh crore, almost Rs 5 lakh crore above the budget

estimates of around Rs 22 lakh crore. There was a growth of around 35 per cent over the last year's revenue collection, led by growth of around 50 per cent indirect taxes and supported by around 20 per cent growth in indirect taxes, he said.