Revenue collection drops by ₹45K crore

MUMBAI: The state revenue generation in the financial year 2021-22 stood at ₹3.17 lakh crore -- a shortfall of around ₹45,000 crore -- against the estimated revenue of ₹3.62 lakh crore. This has led to a reduction in expenditure outlay by almost 15%.

During the presentation of the state budget on March 11, the state revised its estimated revenue receipts for FY 21-22 to ₹3.62 lakh crore from ₹3.69 lakh crore citing the third wave-induced lockdown. The revenue, however, dropped to ₹3.17 lakh crore by March 31, as per the actual figures collated by the finance department this week. The revenue expenditure estimated for the year was ₹3.93 lakh crore, causing a revenue deficit of ₹24,352 crore as per the revised estimates. The actual receipts dropping further has led to the widening of the gap.

“The release of the funds on the revenue expenditure also dropped by nearly 15% to ₹3.29 crore. This will affect spending on the development works as well as the bills of establishment costs. The gap between the receipts and expenditure is made up by more borrowings. We received fair amount of funds from the centre in the last week of March, which helped us reduce the gap,” said an official from finance department.

“The deficit is naturally reflected in the next year’s deficit as some of the pending bills are settled in the next financial year. Secondly, there would be an additional burden of ₹20,000 crore on the state exchequer in FY 2022-23 as the Centre will stop compensating us for the GST losses from July onwards,” the official added.

The official said that the revenue receipts in the revised estimates were not reduced in proportion to the receipts till February last month as the outstanding GST compensation and devolution of the funds was more than ₹26,000 crore.

The GST collection dropped to ₹95,523 crore from the estimated ₹1.18 lakh crore, while the excise collection dropped to ₹16,305 crore from the targeted generation of ₹19,500 crore. The stamp duty and registration collection was more than the targeted amount of ₹32,000 core and stood at ₹36,634 crore.

Rupesh Keer of Samarthan, the group which studies the budget, said, “The state government tends to inflate the figures of the receipts in revised estimates to reduce the deficit, but ultimately it affects the spending on the capital infrastructure. It is nothing but financial mismanagement. The state government should have reduced the revised estimates of the estimated receipts when they presented the budget on March 11, but to keep the deficit figure in check the reduction in the revised estimate of receipt was just ₹6,000 crore.”

State’s outstanding GST compensation with the Centre for the FY 21-22 is ₹26,478 crore.