Direct tax revenue growth slowed from 6.7% to 5.8% during the period. Indirect tax revenue growth too slowed from 16.1% to 7.3%, while income tax revenue fell sharply from 11.3% to 6% during the period under consideration. According to the CGA’s provisional actuals, the previous fiscal saw gross tax revenue shortfall of ₹1.9 trillion. Revenue expenditure growth slowed to 7.9%, but revenue deficit budgeted at 2.3% of GDP has left little fiscal room for government spending. Since the corporate tax cuts may increase tax collection shortfall, reliance on additional borrowing and non-tax revenues to plug the fiscal deficit is set to grow.

Source: Mint October 21, 2019 18:33 UTC