Delhi: As next year's budget comes closer, industry
chamber Assocham has asked the government to raise the
tax-GDP ratio to over 15 per cent and trim wasteful spendings
in subsidies to improve the financial situation.
While releasing 'Reforming Management of India's expenditure'
Assocham president Anil K Agarwal said that a higher GDP
ratio of 15 per cent was necessary given the country's
current public finance crisis as the combined fiscal deficit
of the central and state governments adds up to 9.4 per
cent of GDP.
The study, jointly brought out by the Economic Management
Institute, also urged the government to plug distortions
and leakages in expenditures.
Out of the total budgeted expenditure of Rs5,14,344 crore
2005-06, the chamber said about 12 per cent goes waste
in terms of subsidies for food, fertiliser and petroleum