The government’s fiscal deficit for FY22 has come in at 6.7 percent of the Gross Domestic Product (GDP), skidding off the revised target of 6.9 percent, data released on May 31 by the Controller General of Accounts showed.
The fiscal deficit for FY22 was Rs 15.87 lakh crore - Rs 4,552 crore lower than the revised target of Rs 15.91 lakh crore.
While the FY22 fiscal deficit has come in lower than expected, the Centre's finances for FY23 have already taken a turn for the worse following the cut in excise duty on fuel products and other measures announced earlier this month by the finance ministry to contain elevated inflation.
According to economists, the fiscal deficit for FY23 may exceed the target of 6.4 percent by as much as 50 basis points.
March – the month for which data was awaited – saw the Centre post a fiscal deficit of Rs 2.70 lakh crore. This was sharply lower than the deficit of Rs 4.13 lakh crore seen in March 2021.
In the last month of FY21, the Centre had seen a jump in its expenses as it cleaned up its books by settling the loans taken by the Food Corporation of India over the last five years in lieu of food subsidy it was supposed to receive.
Total receipts in March were up 36.6 percent year-on-year at Rs 3.80 lakh crore as net tax revenue rose 61.5 percent to Rs 3.39 lakh crore because of the quarterly advance tax payments.
Non-tax revenue, however, were down 29.1 percent.
On the expenditure side, total spending was 5.9 percent lower year-on-year in March at Rs 6.50 lakh crore. However, capital expenditure in the last month of FY22 was over five times higher compared to the corresponding period of the previous year at Rs 1.08 lakh crore.Despite the sharp rise in capital expenditure in March, the Centre missed the full-year target by Rs 9,135 crore.
|FY22 (in Rs lakh crore)||YoY change|
|Net tax revenue||18.20||27.6%|
Total receipts in FY22 exceeded the revised estimate by Rs 28,723 crore, while total spending was Rs 24,171 crore more than estimated.