Finance Minister Arun Jaitley on Monday attributed the 0.3 percent fiscal slippage to the Goods and Services Tax (GST) accrued from 11 months of the year rather than 12.
“GST revenue was collected for 11 months, while expenditure accounted for is 12 months. This resulted in a 0.3 percent fiscal slippage. Apart from this, low non-tax revenue and dividends also resulted in the target being trimmed down. However, with higher tax buoyancy, it would be simpler to meet fiscal deficit targets next year,” he said while addressing a gathering alongside senior officials of the Federation of Indian Chambers of Commerce and Industry (FICCI).
In terms of the GST rates, Jaitley said further rationalisation of tax rates and slabs would be facilitated, adding that anti-evasion measures will improve, thereby aiding the achievement of fiscal deficit targets.
“We have made considerable headway on tax correction. In terms of direct tax collection, strong action has been taken. There has been an increase in taxpayer base by incentivising payment. Post the demonetisation, the anonymity of cash disappeared, and more returns have been filed. Also, rationalising of GST tariffs increased the profitability of companies. This process will continue,” he said.
On the increased expenditure on agriculture in the Union Budget 2018-19, Jaitley said these sectors were recognised as the ones that needed maximum support, as it had the maximum potential in generating income.
“Sectors such as infrastructure and agriculture were the ones that needed maximum support, as the maximum amount of income inequality and potential for further growth are in these sectors. It was important to focus on education and healthcare as well. So far, we have taken baby steps, but one big reform was necessary. We have to now work towards implementation of these reforms,” he said.
Jaitley further noted that the proposed healthcare reforms require enhanced cooperation between the central and state governments for successful implementation.