Q1 fiscal deficit hits a record high

The figure till June stood at Rs 2.62 lakh cr of the estimated Rs 5.42 lakh cr for FY14

On a day Finance Minister P Chidambaram said the Centre’s fiscal deficit would be contained at 4.8 per cent of gross domestic product (GDP) for 2013-14, official data showed on Wednesday fiscal deficit for the first quarter reached 48.4 per cent of the Budget Estimate (BE),  a record in the corresponding periods in recent years.

The figure till June stood at Rs 2.62 lakh crore of the estimated Rs 5.42 lakh crore for FY14, showed data released by the Controller General of Accounts (CGA) on Wednesday.

In the corresponding period last year, the fiscal deficit — difference between total revenue and total expenditure of the government — stood at 37 per cent of the BE.

Chidambaram had also said a few weeks ago that the country would achieve its overall budgeted revenue target for this financial year. However, the revenue receipt was at Rs 1.17 lakh crore in June this year, which was 11.1 per cent of the BE of Rs 10.56 lakh crore, against 12.7 per cent in June 2012.

The tax revenue again took a toll as only Rs 1.01 lakh crore, 11.5 per cent of the BE of Rs 8.84 lakh crore, was collected in the first quarter of FY14. Tax revenue in June 2012 was 13.6 per cent of the BE.

However, there was a surge in corporate tax collection as Rs 50,728 crore was collected till June, two per cent higher than Rs 49,405 crore collected in the corresponding period last year. In May, the corporate tax collection took a hit as only Rs 3,232 crore was collected out of the BE of Rs 10,137 crore. In the first month of FY14, the corporate tax stood at a negative Rs 2,136 crore.

On the expenditure front, the non-Plan expenditure was at Rs 2.67 lakh crore, 24 per cent of the BE of Rs 11.09 lakh crore. This was 23.2 per cent in the corresponding period last year. Also, the Plan expenditure was higher than what it was in June 2012. The Centre’s Plan expenditure was Rs 1.14 lakh crore, 20.7 per cent of the BE of Rs 5.55 lakh crore. In June 2012, 16.5 per cent of the BE was spent in this regard.

Revenue deficit, a gap of the government’s current expenditure over current receipts, already crossed the half-way mark as it stood at Rs 2.10 lakh crore, 55.4 per cent of the BE of Rs 3.79 lakh crore. By the end of the first quarter of 2012-13, the revenue deficit stood at 43.6 per cent of the BE..