Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
The EY Economy Watch report projects India's GDP growth at 6.8-7.2% in the next fiscal, citing improved trade agreements and medium-term growth potential. It emphasized that achieving the Viksit Bharat goal by 2047 would require raising the tax-GDP ratio, primarily through better compliance. Significant tax reforms in PIT and GST were carried out this fiscal, focusing on increasing household disposable income and supporting consumption. While these measures may lower gross tax revenues temporarily, the government is expected to stick to its budgeted fiscal deficit target.
India's economy is expected to expand between 6.8-7.2% in the upcoming fiscal year, according to the latest EY Economy Watch report. The report highlighted that while significant tax reforms have already been implemented, achieving the long-term Viksit Bharat goal by 2047 would require a higher tax-GDP ratio, mainly through improved compliance. Advertisement
EY India's Chief Policy Advisor D K Srivastava noted that India's extensive bilateral trade agreements with major economies have strengthened medium-term growth prospects. He estimated the country's real GDP growth for the next fiscal to remain in the 6.8-7.2% range.
The report pointed out that major tax reforms were undertaken during the current fiscal, particularly in personal income tax (PIT) and the Goods and Services Tax (GST). These reforms involved a significant revenue sacrifice intended to boost household disposable income, thereby supporting private consumption demand.
EY further stated that these reforms were expected to reduce the Government of India's Gross Tax Revenues (GTR), potentially falling short of budget estimates for the current fiscal. Despite concerns over the shortfall, the government was widely expected to maintain its budgeted fiscal deficit target.
Source PTI
FAQ
1. What is the projected GDP growth for India in the next fiscal?
According to the EY Economy Watch report, India's real GDP growth is expected to range between 6.8-7.2% in the upcoming fiscal year.
2. What factors are supporting this growth projection?
The report cites improved bilateral trade agreements with major economies, robust medium-term growth potential, and ongoing structural reforms that are expected to enhance investment and consumption in the economy.
3. What is the Viksit Bharat goal mentioned in the report?
Viksit Bharat 2047 is India's long-term vision to become a fully developed economy by its 100th year of independence. EY notes that achieving this goal would require raising the tax-GDP ratio, primarily through better tax compliance.
4. How do recent tax reforms impact growth?
Significant reforms in Personal Income Tax (PIT) and Goods and Services Tax (GST) were implemented in the current fiscal. These measures were designed to increase household disposable income and support private consumption, though they may temporarily reduce gross tax revenues.
5. Will the government's fiscal deficit target be affected?
Despite potential reductions in Gross Tax Revenues (GTR) due to tax reforms, the report expects the government to stick to its budgeted fiscal deficit target for the fiscal year.
6. What is the expected impact on household income?
Tax reforms aim to boost disposable income, which is expected to support consumption demand, a key driver of India's economic growth.
7. Are there risks to this growth projection?
While medium-term prospects are strong, short-term revenue sacrifices from tax reforms could create temporary fiscal pressures. However, EY expects these risks to be manageable, with the government maintaining fiscal discipline.
8. What is the broader significance of these projections?
The EY report indicates that India's economy is well-positioned for sustainable growth, driven by reforms, trade linkages, and rising consumption, which collectively contribute to the country's long-term vision of becoming a developed economy by 2047.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
