Centre's Fiscal Deficit Jumps To 39 Per Cent Of Annual Target In First Half Of FY24

CGA data on Tuesday showed that in actual terms, the fiscal deficit or the gap between expenditure and revenue worked out at Rs 7.02 lakh crore at the end of September 2023

The Centre's fiscal deficit hit 39.3 per cent of the full year target in the first half of the current financial year, the PTI reported. According to the report, the deficit is tad higher than 37.3 per cent recorded in the year-ago period. Data released by the Controller General of Accounts (CGA) on Tuesday showed in actual terms, the fiscal deficit or the gap between expenditure and revenue worked out at Rs 7.02 lakh crore at the end of September 2023.

The central government in its last Union Budget estimated to bring down the fiscal deficit to 5.9 per cent of the gross domestic product (GDP) in the current 2023-24 financial year. The fiscal deficit was 6.4 per cent of the GDP in 2022-23 against the earlier estimate of 6.71 per cent. The capex focus pushed total spending of the Centre to Rs 21.19 lakh crore in April-September, 16.2 per cent higher from last year.

The government's net tax revenue in September jumped 14.3 per cent YoY to Rs 3.56 lakh crore. This was due to a 26.6 per cent rise in corporate tax collections to Rs 2.12 lakh crore. Personal income tax collections also jumped 15.6 per cent to Rs 91,247 crore. This pushed total receipts in September by 9.3 per cent.

The tax revenue was at Rs 11.60 lakh crore or 49.8 per cent of the annual target. During April-September 2022-23, the net tax collection was 52.3 per cent of that year's annual Budget Estimate (BE). The Centre's total expenditure was Rs 21.19 lakh crore or 47.1 per cent of BE of 2023-24, marginally higher than 46.2 per cent of BE 2022-23. 

For April-September, the Centre's total receipts are up 17.7 per cent, with corporate tax collections 20.2 per cent higher than last year and the income tax mop-up 31.1 per cent higher. In August, the government had transferred Rs 72,961 crore to all states as tax devolution, taking the total for the first half of 2023-24 to Rs 4.55 lakh crore, 21.1 per cent higher year-on-year (YoY). However, transfers to states reduce the governmeht's net tax collections.