Govt looks at taxes dividends to meet deficit target

first_imgGovernment is likely to step up efforts to mop up additional resources by hiking duties and seeking higher dividends from PSUs to make up for the anticipated shortfall in disinvestment and direct tax proceeds in its bid to meet the fiscal deficit target.The Finance Ministry had last week raised excise duty on petrol by Rs 1.60 per litre and the same on diesel by 40 paise, which is expected to fetch the exchequer an additional revenue of about Rs 3,200 crore during the rest of the fiscal. This will help the government in partly meeting the shortfall in disinvestment and direct tax realisation. Also Read – Punjab & Sind Bank cuts MCLR by up to 20 basis pointsDue to volatile market conditions, the disinvestment department could garner Rs 12,600 crore so far this fiscal. It has a target of Rs 69,500 crore to be garnered from minority stake sale in PSUs as well as strategic stake sale. With seven months of the current fiscal already over, the Department of Disinvestment has already indicated to the Finance Ministry that it would not be possible to meet the ambitious target.As regards dividend, the government is pushing blue-chip PSUs to either step up their capex or pay higher dividends and not sit on cash pile. Also Read – ‘The great gold bull market has begun’The government had budgeted to collect Rs 36,174 crore by way of dividend from the public sector enterprises, higher than last year’s realisation of Rs 28,423 crore. It has already received a dividend of Rs 65,896 crore from RBI, which is higher than this year’s budget projection of Rs 64,477 crore.Making up for the shortfall in disinvestment through other sources is essential for meeting the fiscal deficit target of 3.9 per cent of GDP.last_img

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