NEW DELHI: The central government’s fiscal deficit in the first four months of the current financial year touched Rs 6.1 lakh crore, an 80% jump over the same period last year. Data released by the government on Thursday showed the fiscal deficit in the April-July period of the financial year has reached 34% of the full-year target of Rs 17.86 lakh crore.
The surge in the fiscal deficit is mainly on account of higher revenue and capital expenditure, and contraction in net tax collection. Capital expenditures or expenses on infrastructure and other assets show a year-on-year increase of 52% to Rs 3.2 lakh crore, while revenue expenditure increased by 15.5% to Rs 10.6 lakh crore.
Net tax revenue of the Centre contracted by 13% to Rs 5.8 lakh crore on account of frontloading of tax devolution to state governments. Tax devolved to state is 50% higher at Rs 3.1 lakh crore as compared with the April-July period in the financial year 2022-23 (FY23).
The gross tax revenue growth also moderated in the April-July period to 2.84% at Rs 8.95 lakh crore. Corporate tax collection declined by more than 10% year-on-year to Rs 1.76 lakh crore, while personal income tax collection increased by a modest 6.4%. However, the central GST collections showed a healthy growth of 16.6% during the April-July period. However, non-tax revenues doubled during the period on the back of the budgeted dividend surplus transfer of Rs 87,400 crore from the Reserve Bank of India.