NEW DELHI: Central government accounts for the first four months of the fiscal year reveal key economic trends in sectors such as corporate sector profits, personal income, consumption of goods and services, global fertilizer prices and increase in imports. The numbers also indicate how the government is managing its fiscal health and economy at a time when macroeconomic stability is a priority for policymakers, due to a combination of external and internal factors. The Comptroller General’s data for July indicates a front-loading of expenditure, so that the effect of planned expenditure starts at the beginning of the year. Mint Takes a closer look
NEW DELHI: Central government accounts for the first four months of the fiscal year reveal key economic trends in sectors such as corporate sector profits, personal income, consumption of goods and services, global fertilizer prices and increase in imports. The numbers also indicate how the government is managing its fiscal health and economy at a time when macroeconomic stability is a priority for policymakers, due to a combination of external and internal factors. The Comptroller General’s data for July indicates a front-loading of expenditure, so that the effect of planned expenditure starts at the beginning of the year. Mint Takes a closer look
What does the data tell us about income?
Incomes of companies and individuals show different trends. Data from the Comptroller General of Accounts (CGA) shows that the Centre’s revenue from corporate tax collection has so far this fiscal year been much weaker than it was collected at the same time a year ago. At the end of July, corporate tax collection ₹1.76 trillion was 10% behind the same time a year ago. However, the personal income tax receipts in the first four months of this financial year ₹2.57 trillion showing a growth of 6% over the same period a year ago. Corporations pay taxes in four installments in a year as advance tax. Total tax revenue for the first four months of the financial year ₹8.9 trillion, which includes indirect taxes, showing an annual growth of 3%.
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What does the data tell us about income?
Incomes of companies and individuals show different trends. Data from the Comptroller General of Accounts (CGA) shows that the Centre’s revenue from corporate tax collection has so far this fiscal year been much weaker than it was collected at the same time a year ago. At the end of July, corporate tax collection ₹1.76 trillion was 10% behind the same time a year ago. However, the personal income tax receipts in the first four months of this financial year ₹2.57 trillion showing a growth of 6% over the same period a year ago. Corporations pay taxes in four installments in a year as advance tax. Total tax revenue for the first four months of the financial year ₹8.9 trillion, which includes indirect taxes, showing an annual growth of 3%.
What do tax data tell us about consumption?
The Center’s receipts from Goods and Services Tax (GST), a tax on consumption, have shown a positive trend with double-digit growth. at ₹2.73 trillion, the overall CGST receipt up to July showed a robust 16% year-on-year growth, highlighting the strong consumption trend. Of course, inflation also plays a role in GST collections. GST compensation cess collections at the end of July showed a 10% year-on-year growth. It is levied on goods in the 28% GST slab, especially automobiles. GST collections are likely to improve further in the coming months due to festive demand for goods and services, but inflation and high interest rates pose risks to consumption growth. Basic customs duty receipts, meanwhile, showed a 27% rise at the end of July.
What is the tax collection trend on petrol and diesel?
Excise duty collection of the Center shows moderate trend. The Center has collected in the first four months of this financial year ₹76,200 crore from central excise duty on crude oil, petrol and diesel. This shows a contraction of more than 10% from the previous year’s excise duty receipts. This is despite windfall taxes on crude oil production and exports of petrol, diesel and jet fuel. Air pressure levied in the form of special additional excise duty on crude oil, petrol and diesel is frequently reviewed based on the international prices of these commodities.
What about dividend income?
In the first four months of this financial year, the Centre’s profit and dividend income showed impressive growth. The center charged more ₹1 trillion by the end of July, exceeding its budget target ₹91,000 crore. Public Sector Undertakings and Reserve Bank pay dividends to the Central Government. Another key trend is higher capital expenditure by the Center during the April-July period compared to the same period a year ago.
What is the trend of central government fiscal deficit?
The central government’s fiscal deficit or the gap between expenditure and receipts is overcome by debt ₹6 trillion or one-third ₹17.9 trillion in the Union Budget for FY24 at the end of July. The fiscal deficit stood at 33.9% of the full-year target at the end of July, showing front-loading of some planned expenditures, including capital expenditures.
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