India: FinMin to monitor revenue, expenditure on daily basis from mid-Mar 22 to keep fiscal deficit in check

  • Keen to keep government deficit within stated targets, the finance ministry will from 15 Mar 22 start daily monitoring of the revenue receipts, including tax collections, as well as expenditure.
  • The move comes against the backdrop of a possible deferment of the initial public offering (IPO) of LIC, which was expected to fetch over INR600bn, to FY23 in view of the ongoing Russia-Ukraine war and its implication on Indian markets.
  • According to officials, the daily monitoring of tax and non-tax revenue collections will help the government in taking timely corrective actions, wherever needed.
  • “The CBDT and CBIC have been asked to report flash figures up to the previous day latest by 12 noon. Besides, other non-tax and disinvestment receipts would have to be reported on a daily basis,” the official told PTI.
  • Officials said that the Controller General of Accounts (CGA) has been asked to provide daily revenue collection and expenditure figures of various ministries between 15 Mar 22 to 31 Mar 22 to the expenditure secretary.
  • The Central Board of Direct Taxes (CBDT) and the Central Board of Indirect Taxes and Customs (CBIC) are the apex bodies responsible for collecting direct and indirect taxes, respectively.
  • Likely deferment of LIC IPO along with additional burden on bringing back Indians stranded in Ukraine will put pressure on the fiscal deficit, which has already been raised in the Revised Estimates (RE) to 6.9% of GDP, from 6.8% estimated earlier.
  • The government has collected INR15.47tr in net tax revenue, which is 87.7% of the full-fiscal target of INR17.65tr. Similarly, non-tax revenue collections stood at INR2.91tr till Jan 22, or 92.9% of the RE target of INR3.13tr.
  • However, the government has raised only INR124.2bn from disinvestments so far this fiscal, against the revised target of INR780bn.
  • It has been banking on LIC IPO to meet the target. The government’s total expenditure till end-Jan 22 worked out to be INR28.09tr, as against the RE of INR37.7tr for the entire fiscal.

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