Covid caused revenue shortfall of Rs 52,750 cr for Telangana
Hyderabad: A mid-year financial review of 2020-21 by Telangana Chief Minister K. Chandrasekhar Rao revealed that the state has suffered an overall revenue shortfall of Rs 52,750 crore due to the Covid pandemic, a note from his office said on Saturday.
Officials from the finance department apprised Rao that the state saw a heavy fall in revenues, requiring amendments to the state’s annual budget.
Incidentally, Telangana received only Rs 33,704 crore revenues through tax and non-tax sources for the seven months from April to October in the current fiscal, compared to Rs 39,608 crore in 2019-20.
However, 2020-21 budget proposals were framed on the estimation that there would be a 15 per cent incremental rise in the southern state’s revenues, which now stands affected by the pandemic blow.
“But due to Coronavirus, the growth did not reach 15 per cent and on the contrary revenues fell compared to last year,” observed the note.
It was estimated that 2020-21 financial year would receive Rs 67,608 crore tax and non-tax income, based on which the budgets were prepared, however, latest estimates suggest that only Rs 33,704 could be raked in as income.
“With this, the state’s own income will be reduced by Rs 33,904 crore,” the note highlighted.
Similarly, Telangana government’s share in Central government taxes has also plummeted significantly.
According to the Union budget, Centre allocated Rs 16,727 crore as the state’ share of Central taxes for 2020-21, which should have translated to an amount of Rs 8,363 crore till October but Telangana received only Rs 6,339 crore.
“As on date, there is a reduction of Rs 2,025 crore in taxes. By the end of the financial year 2020-21, it is estimated that the state would get Rs 11,898 crore instead of Rs 16,727 crore, which was its actual due. With this, the state would lose Rs 4,829 crore,” said the note.
Likewise, Telangana also lost Rs 1,081 crore in the form of centrally sponsored and assisted schemes, which were supposed to be Rs 5,673 crore till October but received only Rs 4,592 crore.
“Under several centrally sponsored and assisted schemes, the Centre for 2020-21 financial year has to give Rs 9,725 crore to the state,” the note said.
By the end of 2020-21, the state may get only Rs 8,923 crore through central schemes instead of Rs 9,725 crore, losing out on Rs 802 crore.
“The CM said that since there will be a shortfall of Rs 52,750 crore in the state’s overall income, he instructed officials concerned to fix priorities accordingly and prepare a financial management plan,” the note added.