ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Fiscal Policy Must Be Reoriented

R J Chelliah Some of the basic premises of our fiscal policy are valid in the context of our conditions and support the case for growing government sector. But they do not require nor do they justify a purely revenue approach to taxation or a high rate of growth of government consumption. Also, in translating any theory of fiscal policy into practice, institutional and administrative realities have to be taken into account. As it has happened, we have scarcely paid any attention to the problem of efficiency in government spending and to devising ways of measuring relative benefits from increases in government expenditure in different directions. Failing to do this, we have permitted increase;: in public expenditure which are clearly unjustified and wasteful.

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