India’s fiscal deficit has been a topic of discussion for years. The government aims to reduce it to 3.8% of GDP by 2025. To achieve this, the focus is on increasing tax revenues and reducing unnecessary expenditures. The GST reforms have helped in simplifying the tax structure, but more needs to be done.
The government plans to introduce a new tax slab and increase the tax base. This is expected to generate additional revenue of around 1.2 lakh crores. The reduction in fiscal deficit will help in reducing the borrowing costs and will also improve the country’s credit rating.
Experts believe that if the government can stick to its fiscal consolidation plan, it will have a positive impact on the economy. The current fiscal deficit is around 6.8% of GDP, which is higher than the projected 5.9%. The government needs to take concrete steps to reduce it. Reducing subsidies and incentives is also on the agenda.
The government plans to introduce a new subsidy bill, which will help in targeting the subsidies to the needy. This is expected to save around 50,000 crores. The fiscal deficit reduction is a challenging task, but with a clear plan and determination, it can be achieved.
The government is confident of meeting its target and improving the country’s fiscal health.