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8/3/2019 Budget and Fiscal Deficitttttt
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Budget and Fiscal Deficit
Business Economics
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What is Budget..???
y A budget is a plan for
how you are going to spend
your money
y It is a Statement of
estimated receipts and
expenditures of the Central
Government of everyfinancial year
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Measures takeny Introduction of DTC and GST by April 2011
y Capitalising PSU banks
y Stimulus to continue for small exporters
y I
nfrastructure development gets a fillip:y Focus on power strengthened
y Rural & urban development get their due share
y Fiscal deficit roadmap unveiled
y
Relief for individual tax payersy MAT hiked, surcharge reduced for companies:
y Partial rollback of fiscal stimulus
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Structure and reform of Budgetary
Practices
Budget
RevenueBudget
RevenueReceipts
RevenueExpenditure
CapitalBudget
CapitalReceipts
CapitalExpenditure
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Revenue Budget
Revenue receipts
Revenue receiptsRevenue
expenditure
Revenueexpenditure
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Capital Budget
Capital receipts
Capital receipts Capital expenditure
Capital expenditure
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Estimated Budget 2010-2011:
Receipts
Total Receipts
11,08,749
Revenue Receipts6,82,212 (61.5%)
Capital Receipts
4,26,537 (38.5%)
RevenueReceipts6,82,212
Non-Tax revenues
1,48,118 (21.7%)
Tax revenue
5,34,094 (78.3%)
CapitalReceipts
4,26,537
Recoveries ofLoans
5,129 (1.2%)
Borrowings &other Liabilities
3,81,408 (89.4%)
Other Receipts
40,000 (9.4%)
(In Crore of Rupees)
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Continued.
y The Government in 2010-11 will collect Rs. 7,46,651 cr
through all kinds of Taxes, out of this money Rs. 3,560 cr will
be transferred to National Calamity Contingency Fund and
Rs. 2,08,997 cr will be share of the state governments.
y Government will get Rs. 1,48,118 cr from non-tax revenue,
such as interest receipts, Dividends and profits, External
grants, and other nontax revenues, plus receipts of Union
Territories
y So far Government has added Rs. 82,000 Cr to its receipts by
sell of 3G spectrum and IPO of Coal India Ltd
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Estimated Budget 2010-2011:
Expenditure
Expenditure
11,08,749
Plan Expenditure
3,73,092(33.64%)
Non-PlanExpenditure
7,35,657(66.36%)
Non-planExpenditure
7,35,657
Capital Non-PlanExpenditure
92,058 (12.51%)
Revenue Non-Plan Expenditure
6,43,599(87.49%)
PlanExpenditure
3,73,092
Capital PlanExpenditure
57,967 (15.53%)
RevenuePlan Expenditure
3,15,125(84.47%)
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Continued.
y Total expenditure of Rs. 11,08,749 cr is 8.53% more than
the last years revised estimates of Rs. 10,21,547.
y The plan expenditure of this year involves roughly 15%
increase while the non-plan expenditure involves 6% increasefrom the revised estimates of 2009-10
y Budget has supported Rs. 2,80,600 to Central Plan Outlay of
Rs. 5,24,484
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Fiscal Deficit
y Internationally used concept.
y It measures entire shortfall in the non-debt for financing the
government expenditure.
yIt reflects the impact of fiscal operations on the indebtednessof the Government by quantifying the total borrowing by the
Government.
Fiscal Deficit =Total expenditure (Revenue receipts +
Reco
verieso
f Lo
ans + Other receipts)
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Estimated Budget
2010-2011:
Fiscal Deficit = 1,108,749
(6,82,212 + 5,129 + 40,000) =
3,81,408
The fiscal deficit for this year is 5.5%
of the estimated GDP of
Rs.69,34,700 Cr.
1. Revenue Receipts 682212
2. Tax Revenue (net to Centre) 534094
3. Non-tax Revenue 148118
4. Capital Receipts (5+6+7) 426537
5. Recoveries of Loans 5129
6. Other Receipts 40000
7. Borrowings and other
Liabilities
381408
8. Total Receipts (1+4) 1108749
9. Non-plan Expenditure 735657
10. On Revenue Account of 643599
11. Interest Payments 248664
12. On Capital Account 92508
13. Plan Expenditure 373092
14. On Revenue Account 315125
15. On Capital Account 5796716. Total Expenditure (9+13) 1108749
17. Revenue Expenditure 958724
18. Capital Expenditure 150025
19. Revenue Deficit (17-1) 276512
20. Fiscal Deficit 38140821. Primary Deficit (20-11) 132744
(In Crore of Rupees)
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How Fiscal Deficit will be reduced?y There are two ways to reduce
the Fiscal Deficit
y Reducing spending
y Raising non-borrowed
receipts
y Non Borrowed receipts
includes:
Tax and Dividend receipts, Loan
recovered, revenues from
auctioning off telecom spectrum
and disinvestment proceeds
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The Fiscal Responsibility and Budget
Management Bill
y The Committee on Fiscal Responsibility Legislation was
constituted on 17th January, 2000 to go into various aspects
of the fiscal system and recommend a draft legislation on
fiscal responsibility.
y Medium-term fiscal policy statement.
y Fiscal policy strategy statement.
y Macro-economic framework statement.
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Makarand Rane
Abhishek Jagwani
Prem LilaniKailash Motwani
Presented by:-
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Estimated Budget 2010-2011:
Receipts
Taxrevenue
5,34,094
Non-Taxrevenues
1,48,118
Revenuereceipts6,82,212
Loans
5,129
Liabiliti
es3,81,408
Other
40,000
Capital
receipts4,26,537
(In Crore of Rupees)
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Estimated Budget 2010-2011:
Expenditure
Non-PlanExpenditure
7,35,657
PlanExpenditure
3,73,092
Expenditure
11,08,749
(In Crore of Rupees)
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Continued.
RevenueNon-Plan
Expenditure
6,43,599
CapitalNon-Plan
Expenditure
92,058
Non-planExpenditure
7,35,657
RevenuePlan Expenditure
3,15,125
RevenuePlan Expenditure
3,15,125
Capital PlanExpenditure
57,967
Capital PlanExpenditure
57,967
PlanExpenditure
3,73,092
PlanExpenditure
3,73,092
(In Crore of Rupees)