Focus on capex will keep India on track to become $5 trillion economy: FinMin

The finance ministry has said that the focus on capex in the recently announced Budget for the current fiscal year will boost manufacturing and tax revenue collections, thereby keeping India on track to becoming a $5 trillion economy.

The ministry said in a statement, "The central government’s focus on making India a global economic powerhouse and the host of measures adopted towards this commitment has directly reflected in India’s GDP growth in recent years. This has translated into increased revenue collection for the exchequer while keeping India well on the track towards achieving a $5 trillion economy.”

Tax revenues in the last fiscal year grew by a record 34 per cent to Rs 27.07 lakh crore, which the ministry said is "a remarkable testimony to the rapid recovery" of the economy following successive waves of COVID-19.

The ministry said apart from a brief setback owing to COVID-19, the government has maintained the nominal GDP growth above 10 per cent in recent years. GST, a simplified way of collecting indirect taxes, has been a revolutionary step propelling India's GDP.

The gross corporate taxes during 2021-22 were Rs 8.6 lakh crore against Rs 6.5 lakh crore in the previous year. This shows that the new simplified tax regime with low rates and no exemptions has lived up to its promise, enhancing Ease of Doing Business for the corporate sector, stimulating India's economy and increasing tax revenues for the government.