An empowered group of ministers on food is scheduled to meet on 7th February to consider...
The government had earlier said that its subsidy bill is likely to increase by over Rs1 lakh crore, over and above the original estimate of Rs1.34 lakh crore, mainly on account of higher outlay towards fertiliser, food and oil
New Delhi: Faced with subdued revenue mop-up and rising fiscal deficit, finance minister Pranab Mukherjee on Wednesday said he is “losing sleep” over mounting subsidy bill, which may cross Budget estimate by Rs1 lakh crore in 2011-12, reports PTI.
“As finance minister when I think of enormity of the subsidies to be provided, I lose my sleep. There is no doubt,” said Mr Mukherjee, who is engaged in the process of firming the Budget for 2012-13 to be tabled in the Lok Sabha on 16th March.
The government had earlier said that its subsidy bill is likely to increase by over Rs1 lakh crore, over and above the original estimate of Rs1.34 lakh crore, mainly on account of higher outlay towards fertiliser, food and oil.
In view of the moderate growth in revenue collection and poor receipts from disinvestment on one hand and the rising subsidy on the other, the finance minister will have a tough time in balancing the budget figures.
The fiscal deficit, which he had proposed to bring down from 4.7% to 4.6% of the gross domestic product (GDP) in 2011-12, is expected to in the range of 5.6%.
Latest tax figures released suggest that government has collected Rs6.63 lakh crore up till January and will not be able to achieve the Rs9.32 lakh crore target for the fiscal.
Meanwhile, CBDT chairman Laxman Das has written to top Income Tax officials to take up the ‘challenge’ of filling the deficit.
“At this critical juncture, our task as revenue administrators becomes that much more challenging. As senior officers, we have to play a critical role in making all possible efforts to improve the situation. We have to ensure every CC/DG achieves the budget target,” Mr Das told his chief commissioners and commissioners.
The finance ministry said in a statement that at the present rate of growth, the Central Board of Excise and Customs, responsible for collecting indirect taxes,”"should be able to achieve the target of Rs3,92,908 crore”.
While the net direct tax collection during April-January was Rs3.46 lakh crore, the realisation from indirect taxes was Rs3.17 lakh crore. With less than two months left in the current fiscal, government has a formidable task to collect Rs2.69 lakh crore.
Mr Mukherjee had said last week that he is exerting pressure on revenue officials to improve tax realisation to meet the total tax collection target.
“I am putting pressure on my colleagues in the CBEC, CBDT ...and on my behalf secretary (revenue) is continuously breathing (down) their neck to improve revenue because our demand and requirement is much more,” he had said.
The lower economic growth of 6.9% projected for 2011-12, as against the original estimate of 9%, will further aggravate the fiscal deficit situation. The economy grew by 8.4% in 2010-11.
Besides, the government has managed to raise only about Rs1,145 crore from disinvestment against the target of Rs40,000 crore this fiscal.
Although the government has been trying to raise funds through alternative routes, including buyback from sale of its equities in PSUs, it is unlikely that any major amount will accrue to the exchequer.