Fiscal deficit slippage is due to shortfall of GST revenue of 1 month: Jaitley
New Delhi :Finance Minister Arun Jaitley said in Rajya Sabha that fiscal deficit slippage is ‘statistical’ because it is primarily due to a shortfall of GST revenue of one month in current fiscal.
On breaching fiscal deficit, Jaitley said the excess of expenditure over revenue (fiscal deficit) in last three years of UPA rule was 5.9 percent, 4.9 percent and 4.5 percent.
In contrast, the fiscal deficit under BJP rule came down to 4.1 percent in the first year, 3.9 percent in second and 3.5 percent in the third.
“This year we were to reach 3.2 percent but we remained at 3.5 percent because of apparent reason” that GST revenue in current fiscal will be short by one month, he said. This is a “statistical slippage of the fiscal deficit”.
“Maintaining fiscal deficit as high as 5.9 percent, you are today lecturing us as to why you didn’t bring it down to 3.2 percent,” he said.
Current Account Deficit (CAD) in during the UPA rule broke “world record” by coming at 6.8 percent and was at 4.2 percent and 4.8 percent in last two years of the Congress rule, he said, adding that under BJP it was “half a percent, one percent one and a half percent” range.
“And we are hearing the music about what you are doing about CAD,” he said.
Speaking of economic performance, FM Jaitley said, “GDP growth in 2012-13 was 5.3 percent and 6.3 percent in following year under Congress, compared to 5.7 percent in one quarter under BJP.”
“We have covered journey from policy paralysis to structural reforms and from an economy being among ‘fragile five’ to ‘bright spot’,” Jaitley added.
On MNREGA, he said that Centre has allocated Rs 550 billion for MNREGA and Rs 1.7 trillion for food subsidy and that spend on rural roads has risen manifold.
The FM was confident that GST collections will increase as anti-evasion measures are added to the indirect tax regime. “Tax net has widened, direct tax collections are up 19.3% in the April-January period as a result of the campaign against black money, GST,” Jaitley said.
“Bringing down the corporate tax to 25% for all companies would hit tax revenue by Rs 450-500 billion, which Budget can’t afford now,” said Jaitley.