Already reeling under losses due to weak financial condition, Maharashtra government is going to face more trouble, as its revenue collection has remained below the expected target. The state has failed to collect enough revenue from Value Added Tax (VAT), stamp duty, excise and Urban Development Department, which will affect the budget to be presented on March 18.
As per the information sought from the finance department, the state has collected VAT of Rs 67,000 crore when the target was Rs 85,000 crore.
The excise department, meanwhile, has not even achieved half the expected target. The expected revenue from the excise department was Rs 15,000 crore and the collected amount is Rs 6,000 crore. Another revenue source, stamp duty collection, also recorded very low collection at Rs 1,200 crore when the expected collection was Rs 4,000 crore. Even the UDD had given a huge target of Rs 5,000 crore but it could collect only Rs 470 crore.
The government is apprehensive that this year too they will have to face revenue deficit in the budget. “Last year, we had revenue deficits of Rs 12,000 crore. We will have to show a zero-deficit budget, which is a practice in prudent accounting. But we worry about the heavy debt the state has borrowed so far. Also, much of the funds are given for drought relief and waiving of Local Body Tax (LBT). We’ve also had to make a financial cut of Rs 15,000 crore to welfare schemes after the Centre reduced its share,” an official from the finance department said on condition of anonymity.
The state’s concerns also rise from other reasons. They include abolition of Local Body Tax (LBT), funds given for natural calamities etc. Maharashtra had abolished LBT assuming that the Centre would bring the Goods and Services Tax (GST). The state government has already taken a burden of Rs 4,210 crore for a period of seven months from August 2015 to March 2016 as grants to the local bodies for abolishing LBT. But even if the GST is approved, it needs to be accepted by at least 15 states before implementation, which is also a tough task for the Centre, the official pointed out.
