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Finance Minister Nirmala Sitharaman on Friday said the tax revenue and disinvestment targets for 2019-20 are realistic and achievable. She said the Budget move to impose a special additional excise duty and road and infrastructure cess of ₹1 each will not be “inflationary”.
Addressing a post-Budget press conference with the five secretaries and Chief Economic Adviser to the Finance Ministry, Sitharaman said the Modi government’s impeccable track record in inflation management over the last five years should put to rest worries about the additional levy on petrol and diesel. “This Budget has been spoken from a position of strength and on the back of the strong mandate that we have got. We have come up with realistic proposals,” she said.
Global situation
Sitharaman explained that the additional levy on petrol and diesel was guided by the global situation and India’s public funding requirement. She highlighted that both petrol and diesel are still outside the GST ambit and that the government was keen to avoid adding to the burden on the personal income tax front, thereby giving preference to indirect tax levies.
Asked as to what dividend amount from Reserve Bank of India (RBI) has been budgeted for 2019-20, Economic Affairs Secretary Subhash Chandra Garg said the Centre expects about ₹90,000 crore.
As for the net revenue implications of the indirect taxes proposals in the Budget, Revenue Secretary Ajay Bhushan Pandey said that mop up is likely to be about ₹25,000 crore. He added that on the direct taxes front, the net gain to the exchequer would be in the range of ₹6,000-7,000 crore. While the Centre expects to mobilise about ₹12,000 crore from the move to hike surcharge on individuals with taxable income above ₹2 crore, it would lose revenue of ₹4,000 crore from the Budget proposal on corporate tax front, he said.
While not referring to the topic in her speech at the Parliament, the Finance Minister later said that the defence outlay has seen a “significant increase” in the latest Budget.
Rise in expenditure
She reeled out numbers to show that the expenditure has increased in almost all the accounting heads for the defence sector.
The outlay for the North-East region has also improved, said Sitharaman — although this, too, was not mentioned in the Budget speech. Garg said the activity for the country’s sovereign bond issuance in the international markets will start soon and that there is no decision yet on the amount that is proposed to be raised.
On spectrum, Garg said the calculations are still being made by the administrative ministry and therefore the Budget has not factored in any revenues on this front.
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