Notwithstanding the hit the revenues — a shortfall of ₹ 800 crore — have taken post introduction of Goods and Services Tax regime in the last two months, the State government does not see the need to hit the panic button.
The shortfall in the revenue, government hopes, is temporary on account of transition to the new GST regime that was rolled out on July 1. Clarity on revenues will emerge both for the Centre and State after three to four monthly cycles as the Centre also extended time to the traders for filing of returns in view of the glitches in the GST network, official sources said.
While there has been concern in various sectors about the delay in release of funds, government sources reel out statistics that already ₹ 53,000 crore has been spent so far this year — ₹ 25,000 crore towards establishment expenditure including salaries, pensions and interest on loans and ₹ 28,000 crore spent on various flagship programmes of the government. “Financial situation is tight but not desperate,” is how senior officials sought to explain the present financial crunch.
Though the most vocal demand about pending dues is from the educational institutions under fee reimbursement scheme, sources clarify that so far ₹477 crore had been released and ₹220 crore was pending for the second quarter out of ₹2,800 crore budget for the year. “We released ₹4,000 crore towards crop loan waiver, cleared bills to the tune of ₹6,000 crore for irrigation, released ₹1,896 crore towards power subsidy, ₹1,331 crore for rice subsidy, ₹384 crore for Shaadi Mubarak and Kalyana Lakshmi and ₹2,500 crore for social security pensions so far,” sources said.Expenditure wise, it is normal for the State to spend about 40 % of expenditure in the first half of the year and the expenditure is greater in the second half. Of total budget of ₹1.5 lakh crore, if expenditure was around 80 to 90 % by the end of the year, it is considered good performance, sources point out. Another unexpected burden on the State was 12 % GST on public works which would roughly amount to ₹ 8,500 crore. But half of it would come back to the State as its tax revenue share. In the remaining half, Centre would devolve part of it to the State. The ultimate burden on the State could be ₹ 2000 crore to ₹ 3,000 crore.
The State is hopeful that Centre will at least bring down the tax rate from the present 12% on earth work component of the public works projects to bring the burden further down, sources say.
