Fiscal deficit hits 12.3 % of full-year target in May

 The first two months of FY23'S Fiscal deficit came at Rs 2.04 trillion or 12.3 per cent of the budget estimation of Rs 16.6 trillion, compared with 8.2 per cent for the same period last year, primarily on the back of lower non-tax revenue and higher capital expenditure.

 The data released by Controller General of accounts (CGA) says that the net tax revenue for April-may came in at Rs 3.07 trillion or 15.9 per cent pf FY23 BE of Rs 19.35 trillion. The net tax revenue was 15.1 per cent of the full-year target, as of FY22, April-may .Comparing with 48 per cent the non tax revenue came in at Rs 49,251 crore or 18.3 per cent of the full target of Rs 2.69 trillion, for the same last year. This is because The Reserve Bank of the India (RBI) for its fiscal year ended March 2022 9 which will reflect in the Centre's current fiscal year). transferred was Rs 30,307 crore as dividend much lower than expectations. " The Centre's non tax revenue have been dampened by the decline in the RBI's surplus transfer." said Aditi Nayar, chief economist with ICRI. Revenue expenditure for April-may FY23 was Rs 4.79 trillion , 15 per cent of the FY23 target- of Rs 31.9 trillion, compared with 14.2 per cent for the same period last year. Capex for the first two months was Rs 1.07 trillion or 14.3 per cent of FY23 BE of Rs 7.5 trillion, compared with 11.4 per cent . "Capital expenditure displayed a sobering downtick to rupees 28149 crores from rupees 78925 crore in April 2002 while my maintaining a high YoY expansion" Nayar said . "we believe that continued high inflation leading to higher nominal GDP is expected to help the union government achieve its tax collection target of physical year 2023" said Sunil Kumar Sinha principal economist with India ratings. A cut in excise duties for petrol and diesel would impact on the excise union excise collections by answering another revenue was likely to compensate for the decline an excise collections. There is no major threat to the fiscal deficit target of 6.4 per sent of GDP for the year in FY22.