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Subdued govt spending despite high tax revenue may impact growth outlook

Private drive could taper off, high tax revenue notwithstanding

tax cut, corporate, investment, investors, taxes, india inc, company, firms, revenue, loss, profit, credit
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The Budget for FY22 provided a capital outlay of Rs 5.54 trillion, a sharp increase of 34.5 per cent over the Budget Estimate of FY21

Dilasha Seth New Delhi
The government's expenditure has contracted in the first four months of the current fiscal year (2021-22, or FY22), despite a surge in tax collections pushing up revenue. This may crimp economic growth since private investments are yet to pick up.
 
For instance, the government’s revenue from taxes has grown 160.9 per cent in the first four months of FY22; its spending has shrunk 5 per cent, compared to the corresponding period last year (2020-21, FY21).
 
In fact, tax collections at Rs 5.3 trillion in April-July were 56 per cent higher than the 2019-20 (FY20) levels; total expenditure was 6 per

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