Run-up to Budget 2023-24: Centre looks to cut non-priority expenditure

Direct and indirect tax revenues may not be enough to offset food and fertiliser subsidies

When finance ministry officials begin their pre-Budget meetings with various central departments and ministries from Monday (October 10), their biggest challenge will be to identify and cut non-priority spending to meet the 2022-23 (FY23) fiscal deficit target of 6.4 per cent of gross domestic product.

Sources informed Business Standard that while direct and indirect tax revenues had been healthy this year, they might not be enough to offset the massive expansion in food and fertiliser subsidies.

“Our topmost priority is the 6.4 per cent target — it is a red line. The revenue flows may not compensate for the additional costs adequately,”