E-Paper
Uttar Pradesh government’s revenue collection goes up by ₹1980.43 crore in July
Although the Uttar Pradesh economy is gradually regaining its momentum, the state government needs to be proactive in augmenting its non-tax revenue, says expert
The Uttar Pradesh government on Wednesday claimed a consistent increase in the state’s revenue with its collections going up by ₹1980.43 crore in July 2021, the first month of the second quarter of 2021-22.
The state government’s revenue collections of ₹12655.85 crore are, however, only 74.1% of the target of ₹17,076.93 crore set for July 2021.
“Yes, our collections are going up consistently. The state government realised revenue of ₹12,655.85 crore in July (2021-22) against ₹10,675.42 crore collected in the same month in 2020-21,” said minister for finance Suresh Khanna while releasing the statistics about revenue collections that took a dip in 2020-21 following restrictions due to the fight against Covid-19.
The state government’s tax revenue increased by ₹ 2026.30 crore in July 2021-22 vis-à-vis the tax collections in July 2020-21. But the non-tax revenue in the mineral and mining sector went down by ₹ 45.87 crore during the same period. The government earned revenue of ₹178.54 crore in this sector in July 2020-21 but the amount declined to ₹132.67 crore in July 2021-22. Hence, the increase in overall revenue collections was reduced to ₹1980.43 crore in July 2021.
Khanna did not give any specific reason for the decline in the non-tax revenue during the period. He said the revenue collections had consistently increased in the first four months of 2021-22 (April 1 to July 2021).
The state government’s total tax collections from April 1 to July 31, 2021 (2021-22) remained about ₹42739.71 crore, 68.8% of the target of ₹ 62,137.00 crore for the same period. Its tax collections in the first four months are about 22.9% of the annual tax collection target of ₹ 1,86,345.00 crore for 2021-2022. The non-tax revenue collections in the first four months remained at ₹ 2065.25 crore, about 30.5% of the target of ₹ 8075.53 crore and 9.7% of the annual target of ₹ 25,421.67 crore.
The state government spends about ₹12,000 crore to ₹13,000 crore every month on the payment of salaries to its employees and pension to its retired employees. The government’s total collections of ₹12655.85 crore in July may only be sufficient for the payment of salaries and pension and the state government may have to go for market borrowings in the coming months to fund development projects.
Uttar Pradesh goes to assembly elections in the early 2022 and the state government will need more funds to complete or step up the pace of many important development projects.
“An increase in the state government’s revenue vis-a-vis the collections of 2020-21 and consistent upward trends in the first four months of 2021-22 clearly indicates that Uttar Pradesh’s economy is gradually regaining its momentum. It also reflects the efforts to collect more revenue, which should put the state government in a comfortable position to undertake developmental activities at an accelerated pace. The increasing revenue gives more fiscal space to state government and reduces its compulsion to go for market borrowings. The state government, however, needs to be proactive in augmenting its non-tax revenue, especially in the mineral and mining sector, in the coming months,” said Yashvir Tyagi, former professor at the department of economics, Lucknow University.
