The State government is pinning its hopes on good collections under the Goods and Services Tax (GST) regime to offset the pressure posed by the rising fiscal deficit. The State has already added nearly five lakh new taxpayers to the GST net.
Chief Minister Devendra Fadnavis said, “Our per capita income has improved and we have overtaken Karnataka to be among the leading States in the country.”
Senior government officials said that the State economy was on a ‘sound track’ as fiscal deficit as a percentage of Gross Domestic Product (GDP) was at 1.9%, well within the national cap of 3%.
The Opposition, however, blamed the government’s ‘miscalculations and reckless’ policies for the widening fiscal deficit, which is estimated to be ₹50,585 crore for 2018-2019.
Government officials said the deficit was not a cause for worry as the budget size had grown to ₹3,38,000 crore.
Mr. Fadnavis clarified that the deficit was burgeoning owing to the farm loan waivers and allocations under the Seventh Pay Commission.
Mr. Fadnavis said, “Without doubt we are under pressure of not breaching our fiscal limits. But by all existing standards, we are well within our limits.” The government also clarified that it was far from breaching the cap on debt as a percentage of GDP, estimated to be
₹24 lakh crore and likely to increase by ₹2.29 lakh crore. The State’s debt to GDP ratio remains at 16.9%.
