The Union government is staring at a tax revenue shortfall of almost Rs 1 lakh crore if not more. Of the Rs 14.8 lakh crore tax revenue it had expected to collect, it could manage only Rs 11 lakh crore till end- February, leaving a gap that is too wide to be covered in March.
This could have a ripple effect on the economy in the next financial year as experts believe the fiscal deficit number for the last financial year may not look good despite the government's efforts to dress up its books.
The fiscal deficit in absolute terms was already Rs 8.5 lakh crore against the Rs 6.3 lakh crore revised estimate. This revised estimate was arrived at by factoring in tax revenues of Rs 14.8 lakh crore. With the government having already revised its fiscal deficit target from 3.3 per cent to 3.4 per cent, the revenue shortfall might further increase the fiscal deficit number closer to the 4 per cent mark.
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