State exchequer earns ₹16K-cr in June
MUMBAI: After tax revenue losses of more than ₹45,000 crore between March and May owing to the Covid-19 lockdown, the state earned ₹16,000 crore in June, reducing the deficit to 20% from 40-50% of the target. The improvement is attributed to pending activities carried out in the real estate and commercial sectors, after they were opened up from late May.
The state government had sustained a loss of ₹26,000 crore in March, ₹10,100 crore in April and around ₹12,000 crore in May against the estimated revenue from various sectors, including goods and services tax (GST), stamp duty and registration, excise on liquor, among others.
Although the estimated monthly revenue from tax is ₹22,000 crore, it goes over ₹45,000 crore in March, as it is the last month of the financial year. The revenue was ₹10,261 crore and ₹11,000 crore in April and May, respectively.
“The revenue for June was 20% less than the projected revenue for the month. The losses were less because of the relaxations of lockdown and mainly because piled up activities in various sectors were carried out in June. Many had purchased houses and vehicles, but registrations were stuck due to the sudden lockdown in March. These formalities were completed as soon as the offices opened. Similarly, the shops and establishment department cleared their inventory leading to GST payments. This may not be witnessed in of July unless more industrial-commercial activities are allowed immediately,” said an official from the finance department.
The monthly bill of the mandatory expenses is around ₹20,000 crore, including salary, establishment cost, interest on loans and incidental expenditure.
The state has borrowed more than ₹25,000 crore in April, May and June to meet the fixed expenditure owing to the drop in revenue. Besides the fixed expenditure, the spending on Covid-19 pandemic and relief package for Cyclone Nisarga-hit districts too contributed to high borrowings. The budgeted estimated annual borrowings were ₹56,697 crore.
According to the officials, they have received most of the dues from the Centre towards devolution of Central taxes, grants and GST compensation.
The state government has already initiated a 67% cut on spending on development and social schemes worth about ₹70,000 crore, which is the amount equivalent to the expected revenue losses. The budgetary estimates for the tax revenue receipts for 2020-21 were ₹2.73 lakh crore.