Telangana CM Fumes at State’s Shoddy Revenue Collections

Hyderabad: Chief Minister A. Revanth Reddy has reportedly expressed serious dissatisfaction with the performance of revenue-earning departments for the first half of the 2024-25 fiscal year (April- September). Excise and mining departments were particularly singled out for underperformance.

During a high-level review meeting at his residence here on Thursday, the Chief Minister took stock of the revenue receipts and instructed officials to rectify the situation in the ongoing second half (October-March), official sources said.

Sources indicate that he was displeased that the revenue receipts for the first half of 2024-25 were only around 35 per cent of the figures projected in the Budget. The government had estimated Rs 2.21 lakh crore for the fiscal year, but only Rs 75,000 crore had been collected by the end of September.

Reddy urged officials to plug leakages in both tax and non-tax revenue streams. The Chief Minister pointed out the rise in demand for sand and liquor, which should have reflected in higher revenue collections, but hinted that potential tax leakages were hindering this.

The shortfall in revenue has compelled the state to rely heavily on loans to fund various welfare schemes and development programmes.

According to sources, Telangana has already utilised Rs 33,449 crore out of its borrowing limit of Rs 49,255 crore for 2024-25, putting the state at risk of exhausting its loan capacity. With another Rs 7,400 crore in borrowing planned for the third quarter, the state would have less than Rs 9,000 crore available for the final quarter.

In light of this, Reddy issued strict directives to all departments to focus on improving revenue collections. He instructed them to devise monthly target plans to meet annual goals and urged transparency and integrity in the tax collection process.

Additionally, he authorised departments to introduce necessary reforms to boost revenue generation and contemplate organisational restructuring, if required.

The state government faces several financial challenges, including funding the crop loan waiver programme and the Rythu Bharosa scheme. Over Rs 13,000 crore is needed to cover the pending crop loan waivers, and approximately Rs 7,500 crore is required for rythu bharosa for the upcoming rabi season.

Furthermore, the government has delayed payments of five Dearness Allowance (DA) arrears to employees, each of which adds an annual burden of Rs 1,500 crore to the state exchequer.

The meeting was attended by Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka, Revenue Minister Ponguleti Srinivas Reddy, Chief Secretary A. Santhi Kumari, Special Chief Secretary (Finance) K. Ramakrishna Rao, and senior officials from commercial taxes, excise, stamps and registration, and mining departments.