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Mohandas Pai Writes: Budget 2022 will sustain growth but middle class, startups left high and dry

The government missed a great opportunity to deliver a truly transformative Budget, where tax relief could have been given to the middle class. Overall, this government has continued its strategy of growth: giving states more money, and spending on infrastructure, writes Mohandas Pai.

February 03, 2022 / 03:44 PM IST
File Image: (Source: Reutera)

File Image: (Source: Reutera)

Budget 2022-23 carries forward the NDA government’s growth and development efforts into the next year. The current year has been outstanding for the Indian economy; the GDP has increased from Rs 197 lakh crore to Rs 232 lakh crore, a rise of Rs 35 lakh crore—at Rs 75-to-a-dollar, that is an increase of $466 billion in a year. This is enormous and we can see India’s GDP growing to nearly $3.15 trillion, a nominal growth of around 17.5 per cent.

This high growth, coming on the back of a COVID-hit year, is a testimony to the robustness of the Indian economy and the many initiatives taken by the government to protect India in the wake of a shutdown.

Budget on Earnings and Expenditure

The government budgeted gross tax revenue at Rs 22.17 lakh crore, in the revised estimate, it increased the revenue to Rs 25.16 lakh crore, a jump of Rs 3 lakh crore. However, when one looks at the government data, the tax collection figures till December 2021 stood at Rs 19.28 lakh crore, and then considering the tax collection between January-March to be comparable to last year, at about Rs 6.85 lakh crore, the total tax collection could be Rs 26.13 lakh crore. It is clear that the government has underestimated tax collection in its revised estimate.