A three-pronged strategy

Lay out a credible fiscal consolidation plan, reverse tax buoyancy decline, and boost non-tax revenues

In two months from now, Union Finance Minister Nirmala Sitharaman will present the Budget for 2021-22. This will be her third Budget and much more challenging than her previous two exercises in July 2019 and February 2020.

There is, however, a perception that with the Indian economy bouncing back next fiscal year in terms of growth, Budget-making will be a lot easier than the tough challenges the finance minister is encountering in the current year. Revenues would increase as a consequence, making the task of managing government expenditure less onerous. So, why should next year’s Budget be more challenging?

This is a