SME Times is powered by   
Search News
Just in:   • Coal production from India's commercial mines jumps 16.4 pc in April-June quarter  • India poised to become 3rd-largest economy by 2030, overtaking Germany: Hardeep Puri  • India's industrial production registers 1.2 per cent growth in May  • Govt committed to building safe and smart energy future: Minister  • Sanchez defends Spain's defence budget in response to Trump's threats 
Last updated: 23 Sep, 2019  

Sitharaman.9.Thmb.jpg No plans to revise fiscal deficit target, cut spending: FM

Sitharaman.9.jpg
   Top Stories
» India poised to become 3rd-largest economy by 2030, overtaking Germany: Hardeep Puri
» India's industrial production registers 1.2 per cent growth in May
» Govt committed to building safe and smart energy future: Minister
» QCOs benefit MSMEs by enhancing product quality, consumer satisfaction: Piyush Goyal
» Stock market opens higher as Trump indicates ‘great’ trade deal with India
SME Times News Bureau | 23 Sep, 2019
The government has no plans to revise the fiscal deficit or cut any expenditure following the corporate tax cuts, Finance Minister Nirmala Sitharaman said on Sunday.

The government cut corporate tax rates on Friday in a move designed to woo manufacturers, revive private investment and consumption and lift growth from a six-year low.

With the corporate tax cuts cost Rs 1.45 lakh crore to the exchequer, Sitharaman said that the government is not planning to cut its expenditure to meet the shortfall.

The Minister had earlier said infrastructure ministries has been asked to front load expenditure to revive capital expenditure to boost growth. The Expenditure Secretary is meeting secretaries of line ministries to fast-track their allocated spending to boost the economy, she added.

Sitharaman now said the government would only review the fiscal deficit target closer to the 2020-21 budget.

"At this point of time we are not revising any target. The decision will be taken later," she told reporters at her residence here, adding that there was no plan to cut spending currently.

Sitharaman said the move to cut corporate tax rates is a "calculative risk" and she has not revised any of the revenue or expenditure targets for the fiscal year yet.

"I will take a review closer to the stage when revised estimates will be estimated," she said.

She also said the government would decide on additional market borrowings for the second half of 2019-20 later.

Ratings firm S&P Global said on Friday India's move to cut corporate tax rates was a "credit negative development" despite potentially boosting the economy as it will widen its fiscal deficit.

Global rating agency Moody's said on Saturday that the corporate tax reduction is credit positive for companies but increases the government's fiscal risks.

Government sources told Reuters this month that India is likely to miss its fiscal deficit target for the current financial year and, toward the end of 2019, be forced to raise it to 3.5 per cent of GDP from 3.3 per cent after economic growth fell to a six-year low of 5 per cent in the April-June quarter.

Though equity markets welcomed the move, bond yields spiked to a near three-month high on speculation that the government may have to borrow more to meet its spending needs.

On September 20, Sitharaman announced a reduction in the base corporate tax rate to 22 per cent from 30 per cent as part of stimulus measures to revive the slowing economic growth.

 
Print the Page
Add to Favorite
 
Share this on :
 

Please comment on this story:
 
Subject :
Message:
(Maximum 1500 characters)  Characters left 1500
Your name:
 

 
  Customs Exchange Rates
Currency Import Export
US Dollar
84.35
82.60
UK Pound
106.35
102.90
Euro
92.50
89.35
Japanese Yen 55.05 53.40
As on 12 Oct, 2024
  Daily Poll
Do you think Indian businesses will be negatively affected by Trump's America First Policy?
 Yes
 No
 Can't Say
  Commented Stories
 
 
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter