India’s quest to reduce its budget deficit has been a longstanding priority for the government. With a fiscal deficit of 6.8% of GDP in 2020-21, India has been striving to bring it down to 4.5% by 2025-26. The government has proposed various measures to achieve this goal, including increasing tax revenues and reducing expenditures.
For instance, the Goods and Services Tax (GST) has been a significant contributor to tax revenues, accounting for 15% of total tax collections in 2020-21. However,Experts believe that the government needs to do more to reduce its reliance on borrowing and increase its non-tax revenues. Furthermore, the government also needs to address the issue of tax evasion and improve its tax collection efficiency., The road ahead is challenging, but with fiscal discipline and sustained efforts, India can achieve its goal of reducing budget deficit.