Trends and Growth in the Receipts of Government of India

INTRODUCTION

The economic development of an economy depends upon the rate of capital formation which depends upon the size of revenue not only to break the vicious circle of poverty but also to enhance the GDP. As a welfare State, the Government has to think about the various ways and means of the revenue generation and capital formation in addition to expending it judiciously with the help of private sector. The revenue includes both revenue and capital receipts which are also known as budgeted receipts. The budgets have two main components- receipts and expenditures. The receipts may be of Revenue and Capital nature; and similarly the expenditures may also be divided into revenue and capital form.

Salim, Nassir (2012) studied impact of fiscal policy on the economy of Turkey and Libya. He finds rising amount of expenditure deals in increase in GDP of Turkey and Libya. He also finds that bigger taxation leads to less consumption by the consumer. Along with the main study he also examined that private consumptions and investments are strongly affected by the tax rate in Turkey and Libya. It was highlighted through a report (2016) that the Government of Haryana is in the the tight grip of heavy debt which has been procured by the Government from various sources year over years. According to the report, the total debt which was Rs. 23,320 Crore during 2004-05 as increased to Rs. 98,843 during 2015-16 with a CAGR 12.79 per cent.

OBJECTIVES OF THE STUDY

1. To study the trend and growth of Revenue Receipts of the Government of India during the period under study.

The present study is descriptive as well as analytical in nature which covers both the Revenue Receipts and Capital Receipts of the Government of India. The data have been collected mainly from the website of ministry of Finance from 2013-14 to 2017-18 for a period of 5 years. The various statistical techniques such as trend analysis, mean score, standard deviation and CAGR are applied to conduct the present study.

Table 1 indicates trends in budgeted estimates, revised estimates and actual values of revenue receipts. Budget estimates increased all the way and all the time during the period taken into care except in 2015-16 where it declined. The same linear trend is also found in case of revised estimates whereas actual receipts increased year by year without any break in its flow during the period under consideration. Actual receipts are always lower than its estimated values or targets. Budget estimates and revised estimates shows growth by 7.49 per cent and 7.90 per cent whereas actually it grows by 7.18 per cent.

Figure 1.1 cross checks the results of table 1 and prove that actual revenue receipts are most of the time is less than budgeted values. It means Government is not able to forecast proper estimates.

actual receipts are less than of budgeted estimates during the study.

Table 2 reveals that there is also an increasing trend in capital receipts with less fluctuation in figures is registered as comparison to revenue receipts during the period taken into account. An oscillating trend was found in case of budgeted receipts and increasing trends were found for both revised estimates (except 2014-15 in which a decline registered) and actual capital receipts during the period under study. The highest CAGR was registered in case of actual capital receipts (5.35 per cent) followed by revised estimates (4.89 per cent) and then Budgeted estimates (0.71 per cent).

Figure 2.1with line graph also makes sure the computed trends in table 2. All the three variables are very close to each other‘s. That is why there is a less fluctuations in capital receipts found during the study.

Figure 2.2 compare the total budgeted estimates, revised estimates and actual figures of capital receipts. As we look after the all the three figures, it can be said there is very thin deviation between these three and so there is less fluctuations in comparison to revenue receipts.

The increasing trends were found for both types of receipts- revenue receipts and capital receipts during the period under study. But the main thing is deviation in their budgeted targets and actual receipts. No single year is there for which it can be said that there is not any deviation between budgeted targets and actual values. In brief, it is observed that budgets are over estimated all the time and all the way during the period under study. So, it is suggested to the Government to take care all the factors affecting revenue while preparing budgets.

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Research Scholar IMSAR, MD University Rohtak naveenrohilla5@gmail.com