Government Proves Naysayers Wrong: Achieves 3.4 Per Cent Fiscal Deficit Target Despite Tax Collection Shortfall

Repudiating all concerns that the central government will not meet its fiscal deficit target for the last financial year, a government official today (9 April) said that the target has been achieved, reports Economic Times (ET).

The government has been able to limit the fiscal deficit to 3.4 per cent of gross domestic product (GD) in 2018/19 for the fiscal year ending 31 March (2019). This was the target that the government had set for itself in the budget.

This announcement is all the more impressive as the government missed its tax collections target by over Rs 1 lakh crores ($14.41 billion), including about Rs 50,000 crores shortfall in income tax receipts.

In September 2018, Economic affairs secretary Subhash Chandra Garg had stated that “the government (was) committed....something would be done to ensure that the fiscal deficit is not breached.”

The Motto Of Fiscal Discipline

Reiterating the NDA government’s commitment to fiscal responsibility, the then finance minister Piyush Goyal had said in February, “In fact, this (the present NDA government) is the only government which has actually gone down the path of fiscal consolidation. You saw in Congress time, within a year it went from 2.5 per cent to 6.5 per cent and in all our years the glide path has been downward. This has been the only government which has consistently kept a downward glide path of fiscal deficit after NDA1.”

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