Revenue crisis deepens in Telangana
State government's revenue receipts continue to fall short of its ambitious targets, raising concerns about its ability to manage mounting debts.
Hyderabad: Telangana’s financial health is under significant strain as the State government’s revenue receipts continue to fall short of its ambitious targets, raising concerns about its ability to manage mounting debts. At the end of the first half of the current fiscal year i.e. April-September, the State government managed to collect only Rs.73,941 crore, just 33.42 per cent of its annual revenue target of Rs.2.21 lakh crore.
This indicates a sharp decline compared to the same period last year when the State had collected Rs.87,207 crore, now trailing by Rs.13,266 crore. Compared to the monthly targets, the State is falling short by about Rs.2,000 crore each month in revenue collections, compared to the last financial year. There is a significant gap that underscores the fiscal challenges Telangana faces.
According to audit reports till August, the State’s revenue receipts from April to August were Rs.61,618 crore, or 27.85 per cent of the annual target. The State’s tax revenue during this period amounted to Rs.57,722 crore, marginally higher than the previous year’s Rs.55,441 crore but still far below expectations.
Key components of Telangana’s revenue mix are struggling to meet their targets. The Goods and Services Tax (GST) revenue stands at Rs.20,500 crore, well short of the annual target of Rs.58,594 crore. Revenue from Stamps and Registrations reached only Rs.6,390 crore, against a target of Rs.18,229 crore, while Sales Tax collections amounted to Rs.13,487 crore, compared to the expected Rs.33,449 crore. Similarly, State Excise revenue stood at Rs.7,807 crore out of an annual target of Rs.25,617 crore.
The State’s share of Union taxes was recorded at Rs.6,220 crore, out of the estimated Rs.18,384 crore, showing a substantial shortfall in Central transfers. Non-tax revenue, an important stream, delivered a dismal Rs.1,449 crore, against a projection of Rs.35,208 crore. Additionally, the State received only Rs.2,447 crore in grants-in-aid from the Centre, far below the budget estimate of Rs.21,636 crore.
Telangana’s reliance on capital receipts, including market borrowings, has also increased to Rs.29,467 crore, more than half of the annual target of Rs.52,815 crore. The State’s total debt for the fiscal year stands at Rs.32,500 crore, nearing the yearly estimate of Rs.62,012 crore by the end of September.
