New Delhi: India’s Gross Domestic Product (GDP) could grow between 6.8-7.2 per cent in the next fiscal, EY Economy Watch report said on Thursday.
It suggested that to attain the Viksit Bharat goal by 2047, India may have to increase its tax-GDP ratio largely by improvement of tax compliance as major tax reforms have already taken place.
“In the background of India’s extensive bilateral trade agreements with other major economies or economic groups, India’s medium-term prospects have brightened up. We estimate India’s real GDP growth to be in the range of 6.8-7.2 per cent in FY27,” EY India Chief Policy Advisor D K Srivastava said.
The EY Economy Watch report said that major tax reforms were undertaken in the current fiscal, in particular relating to personal income tax (PIT) and the goods and services tax (GST).
Both these reforms involved a considerable amount of revenue forgone aimed at increasing household disposable incomes so that private consumption demand could be supported.
“These tax reforms involved considerable sacrifice of GoI’s Gross Tax Revenues (GTR), which were expected to fall short of the budget estimates for current financial year. In spite of the apprehension of this revenue shortfall, the Government of India was widely expected to adhere to its budgeted fiscal deficit target for FY2025-26,” the
report said.