NEW DELHI: Higher than estimated nominal
GDP
, helped the Centre close 2023-24 with a
fiscal deficit
of 5.6% of GDP, compared with govt’s projection of 5.8% in revised estimates (RE), providing further cheer to mandarins in North Block.
Latest data released by the Controller General of Accounts pegged the fiscal deficit at Rs 16.5 lakh crore, which was 95% of Rs 17.3 lakh crore in RE.
Higher than estimated
revenue collections
— 101.2% of RE — helped the Centre corner Rs 23.3 lakh crore as net taxes. Overall expenditure worked out to be Rs 44.4 lakh crore, which was 98.9% of RE.
CGA data
also showed that revenue deficit during FY24 was 2.6% of the GDP and effective revenue deficit was 1.6% of the GDP.
Govt officials, however, refrained from giving any guidance, suggesting that a call will be taken when the budget is presented by the new govt next month. In the interim budget, finance minister Nirmala Sitharaman has budgeted for a fiscal deficit of 5.1% of GDP for the current financial year and to reach 4.5% by 2025-26.
Icra Chief Economist Aditi Nayar said govt’s fiscal deficit was contained below RE for FY24, benefiting from higher-than-anticipated receipts and lower than estimated revenue spending, with only a marginal miss in capital expenditure.
“The encouraging fiscal deficit numbers can be dedicated to taxpayers of the country. The efficiency of CBDT and CBIC and especially ground covered in implementation of artificial intelligence in unearthing fake transactions have also to be appreciated by honest taxpayers,” Vivek Jalan, Partner at Tax Connect Advisory Services.
According to CGA data, almost Rs 11.3 lakh crore was transferred to states as devolution, an increase of Rs 1.8 lakh crore over the previous year. Meanwhile, according to another CGA data, the fiscal deficit in April was 12.5% of the Budget Estimate (BE) for 2024-25 or Rs 2.1 lakh crore. It was 7.5% of BE 2023-24 in April 2023.
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