Macro Economy

Fiscal deficit touches 103% of Budget Estimate in April-July

Our Bureau New Delhi | Updated on August 31, 2020 Published on August 31, 2020

Fiscal deficit has exceeded Budget Estimate (BE) in the first four months — April-July of FY21 — due to lower tax collection, data released by the Controller General of Accounts (CGA) on Monday revealed.

The Budget pegged the fiscal deficit at ₹7.96 lakh crore which is 3.5 per cent of GDP (Gross Domestic Product). The Centre has already announced additional borrowing of ₹4 lakh crore which will take the deficit up to 6 per cent. This additional borrowing is yet to be approved by Parliament which will then officially raise the deficit bar for the current fiscal.

According to data, expenditure improved a tad to 34.7 per cent from 34 per cent during April-July period. However, tax collection was down by nearly 30 per cent. This resulted in fiscal deficit touching over ₹8 lakh crore, which is 103 per cent of the Budget Estimate, against 77.8 per cent registered during the first four months of FY20.

 

During the period under review, barring urea, food, petroleum and nutrient- based fertilizer saw a decline in subsidy pay out. Food subsidy was 49 per cent of BE against 59 per cent during the corresponding period of last fiscal. This is despite higher quantity of subsidised food being distributed on account of Covid. Similarly, petroleum subsidy came down to 40 per cent as against 76 per cent.

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Published on August 31, 2020
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