Gujarat's treasury Talia Jatak, find out what the government will do now for the salaries of employees
It is feared that the state government's revenue will be hit by more than Rs 10,000 crore in two months due to the transition and lockdown situation. Not only this, the share from the center can also be reduced drastically. There are fears of an unimaginable loss to the government's coffers if the epidemic continues.
All estimates for the current year's budget are likely to be disrupted. The state government will not be able to launch new schemes this year. Now that the government's coffers are running low, a proposal has been made to take loans to pay the salaries of the employees. The government needs Rs 4,000 crore per month for employees and pensioners.
The state government has also incurred huge losses in the financial year 2019-20. The state has received Rs 5815 crore less in central taxes while the state taxes have been reduced by Rs 1792 crore. On the other hand, the amount of tax due in one year has increased by Rs 12,708 crore. The state government has not been able to recover the disputed as well as undisputed Rs 43,000 crore, yet the Gujarat government has collected revenue of Rs 1.50 lakh crore in the year ended March.
According to the Finance Department, the state government has set a revenue target of Rs 136447 crore and a revenue of Rs 46766 crore by the end of the financial year 2020-21. Thus, the total revenue of Gujarat government is estimated to be Rs 183213 crore by the end of March 2021, but due to the transition of Koro, the government is estimated to lose a total of Rs 10,000 crore in March, April and May. There are some revenues during lockdown that are zero.
The biggest loss to the Gujarat government is in GST and value added tax. In addition there is stamp duty as well as land revenue income. The biggest hit in electricity taxes has been due to the closure of industrial groups. New vehicles are not registered in the state. Real estate is a complete lockdown so stamp duty and registration revenue is off. Both of these segments are down 90 percent.
"We will be able to estimate in June that the state's various tax revenues are declining," said a senior official of the state finance department. Although the central government is also considering getting relief, it will in fact be decided after the survey is completed.
The central government has paid only Rs 16,666 crore in October and November to help the state during the transition to Koro. Only 50 per cent of this amount has been received. The Center still has to pay Gujarat in December, January, February and March. If the lockdown increases, it could include April and May.