The Union government's fiscal deficit works out to be ₹5.47 lakh crore or 36.3% of the budget estimates at the end of October 2021 on the back of improvement in revenue collection, according to the data released by the Controller General of Accounts (CGA) on Tuesday.
The deficit figures in the current fiscal appear better than the previous financial year when the gap between expenditure and revenue had soared to 119.7% of the last year's Budget Estimates (BE) mainly on account of a jump in expenditure to deal with the COVID-19 pandemic.
In absolute terms, the fiscal deficit was ₹5,47,026 crore at the end of October, the CGA said.
For the current financial year, the government expects the deficit at 6.8% of GDP or ₹15.06 lakh crore.
Commenting on the data, Aditi Nayar, Chief Economist, ICRA Limited, said despite the likely revenue foregone from the excise and customs duty relief, the gross tax revenue of the central government is likely to exceed the 2021-22 BE by a significant ₹1.8 lakh crore, of which around ₹60,000 crore would be shared with the states.
"Adding the higher than budgeted surplus transfer by the RBI to the extra net tax revenues, we expect the Government of India's net revenue receipts to exceed the 2021-22 BE by ₹1.7 lakh crore," she said.
According to the CGA, the Government of India received about ₹12.79 lakh crore (64.8 per cent of corresponding BE 2021-22 of total receipts) up to October, 2021 comprising ₹10.53 lakh crore tax revenue (net to centre), ₹2.06 lakh crore of non-tax revenue and Rs 19,722 crore of non-debt capital receipts.
Vivek Jalan, Partner, Tax Connect Advisory, a multidisciplinary tax consultancy firm, said the budgeted GST collection was almost ₹1 lakh crore a month and already in seven months in this fiscal the mop-up has reached ₹8 lakh crore.
"Increase in GST rates of textiles, solar panels, footwear, job work in alcohol industry, packaging materials, including various circulars on supplies like mining, ice-creams clarifying that higher GST rates are applicable, have paved the way for consistently increased GST collections going forward too," Mr Jalan added.
Ms Nayar also said the GST collections in November 2021 are likely to exceed the prevailing highest collections recorded in April 2021 (₹1.4 lakh crore), given the all-time high generation of e-way bills during October 2021.
According to the data, total expenditure incurred by the Centre was ₹18.26 lakh crore (52.4% of corresponding BE 2021-22), out of which ₹15.73 lakh crore is on revenue account and ₹2.53 lakh crore is on capital account.
Out of the total revenue expenditure, about ₹4 lakh crore was on account of interest payments and ₹2.09 lakh crore on account of major subsidies.
The fiscal deficit for 2020-21 was 9.3 per cent of the Gross Domestic Product (GDP), better than 9.5% projected in the revised estimates in the Budget in February.
The CAG added that the fiscal deficit figure shown in monthly accounts during a financial year is not necessarily an indicator of fiscal deficit for the year as it gets impacted by temporal mismatch between flow of not-debt receipts and expenditure up to that month.