Centre says direct tax refund responsible for fiscal deficit increase

New Delhi, 20 December 2011

Replying to a set of questions asked by Rajya Sabha MP Shri Parimal Nathwani, the Minister of state in the ministry of Finance Shri Namo Narain Meena informed the house that, centre’s Fiscal deficit for the period upto September 2011, was Rs 2,80,810 crore which was 68% of the budget estimates of 2011-12.

“The fiscal deficit upto September 2010 was Rs 1,33,252 crore which was 23.9% of budget estimates of 2011-11,” the minister added.

The minister further said that increase in fiscal deficit during the first half of 2011-12 is due to front loading of direct tax refunds in the current year. Lower fiscal deficit during the first half of 2010-11 was on account of one time receipt of non-tax revenue from auction of 4G & BWA spectrum.

Narrating the efforts made by government to mobile resources to ease the pressure, the minister said, “to contain the fiscal deficit in 2011-12, Government has advised all Ministries/Departments to adhere to the expenditure ceilings in the budget estimates 2011-12. They have also advised to meet additional expenditure requirements, if any, during the year through savings from the overall expenditure outlays. Instructions have also been issued to concerned departments to make conerted efforts to achive the revenue collection targets for 2011-12.”