Slowdown adds to worry, affects state’s revenue - Mandi Gobindgarh News

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Wednesday, September 11, 2019

Slowdown adds to worry, affects state’s revenue

Slowdown adds to worry, affects state’s revenue

Ruchika M Khanna

Tribune News Service

Chandigarh, September 10

The signs of recession have started reflecting in the cash-strapped government’s balance sheets. With time running towards half year end, the fiscal indicators reflect a worrying phenomenon, witnessed all across the country.

The state’s GST collection is hitting a low, as is the Motor Vehicle Tax (MVT) collection. These indicate that the spending capacity of the Punjabis is declining too. A low MVT collection is a clear indication that the sale of automobiles has slumped. With the government reducing VAT on retail fuel, the total taxon these too has declined. The only saving grace seems to be a higher devolution of Central taxes and higher grants-in-aid from the Centre.

Figures available with The Tribune reveal that GST collections in Punjab are just Rs 3194.19 crore (till July-end) against the targeted Rs 17109. 56 crore. This is just 18.67 per cent of the target for this fiscal, as against 21 per cent of the total targeted GST, collected in the corresponding period last year. Last year, the total GST collected was Rs 13,936.36 crore against Rs 21,440.55 crore target.

A senior official said, “We were hopeful that by reducing taxes on petrol and diesel, the diversion of fuel sale to the neighbouring states would stop. However, the rather dismal VAT collection (Rs 1,950 crore till July-end) has shown that the diversion has not stopped, nor has the total tax collected on sale of retail fuels increased. Even the state excise collections have not been too good, with collections remaining at Rs 1,521 crore, against the year’s target of Rs 6,200 crore.”

The only hope, say officials in the Finance Department, is that the festive season would force people to start spending money, giving a fillip to the state’s revenues.

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