UP revenue kitty surges to 98% of last fiscal

Virendra Singh Rawat

Lucknow, Aug 10, 2020

After reporting a massive dip in tax and non-tax revenues in the first quarter (Apr-June) of the current financial year 2020-21 due to covid-19 lockdown, the mop up in July 2020 has surged to 98% of the corresponding month last fiscal.

Compared to revenue collection by various departments in July 2019 at more than Rs 10,926 crore, the state kitty surged to Rs 10,675 crore in July 2020, which is roughly 97.7% of July 2019 level.

“The economic activity in UP is coming back to track faster than we had expected and it is getting reflected in our revenues,” UP finance minister Suresh Khanna said here recently.

He conceded that covid-19 had disrupted the economic and commercial activities, as such there was sluggish revenue collection during the first three months of the current fiscal. Interestingly, the revenues in July 2020 under value added tax (VAT), excise/stamp/transport and mining heads were higher compared to July 2019, showing faster recouping of the adverse revenue situation.

Owing to the impact of covid-19 lockdown, against tax and non-tax revenue target of Rs 46,127 crore during Apr-June 2020, the state’s collection stood at Rs 17,412 crore or 37.74 per cent of the quarterly target. Of this, the tax revenue during Apr-June 2020 stood at Rs 15,716 crore against the target of Rs 41,602 crore, which was 37.77 per cent of the quarterly target. Similarly, the non-tax revenue mop up stood at Rs 1,696 crore or 37.5 per cent compared to Rs 4,525 crore during the Apr-June quarter of 2020-21.

“We have been able to balance our revenue and expenditure quite efficiently despite the covid-19 headwinds due to our adherence to financial management and fiscal discipline,” Khanna noted. He said the government paid the salaries and pensions to state employees and retired personnel on time without any deductions, although there were instances of some states resorting to delays or deductions to manage the adverse financial condition arising out of the lockdown.

Meanwhile, the government is in the process to recalibrate and pare revenue targets of the current financial year under the shadow of lockdown impact. The state is aiming to at least touch last financial year’s revenue levels, although the targets set earlier were 10-15 per cent higher.

EOM