Thiruvananthapuram: Finance minister T.M. Thomas Isaac is turning out to be worse than his predecessor K.M. Mani in mobilising revenues.
Dr Isaac, who has pivoted his ‘escape plan’ around the hope of a high tax growth of 20 per cent, had alleged that poor tax growth under Mr Mani’s watch was simply the result of corruption. Ironically, tax growth under him has fallen below the UDF figures.
After a month in office, Dr Isaac had triumphantly declared that growth in tax collection during June had swelled to 19 per cent, the highest in three years. But the next three months, including the highest spending months of August and September, have seen a dramatic fall.
July’s growth was perhaps the worst in history, merely 3 per cent; a virtual stagnation of sorts, from Rs 2,518.96 crore in July 2015 to only Rs 2,593.21 crore this July. Never before has growth in tax collection gone below 7 per cent, not even during K.M. Mani’s tenure
More shocking are the figures for August and September, the 60-day period when Malayalis’ traditionally spend the most in the year. “This is when the state hopes to mop up maximum revenue,” a top tax official said. Growth during both these high-spending months is a disappointing nine per cent, a far cry from the 22-24 per cent the Commercial Sales Tax department was aiming for. K.M. Mani had fared better. During the corresponding period last fiscal, growth in revenue was 11-12 per cent.
If monthly collection was Rs 2,487.67 crore in August 2015, it was Rs 2,701.95 this August. The expectation was Rs 3,035 crore. This September the tax collection was Rs 3,038 crore, up from Rs 2,800.50 crore during September 2015. The expectation was Rs 3,420 crore.
Tax expert Prof. Jose Sebastian said the figures were “alarmingly low”. “I don’t see any reason why monthly collection should drop to such base levels,” Prof. Sebastian said. “Perhaps it could be the consequence of the Gulf crisis, which is leading to lower remittances and which in turn is affecting the overall demand,” he added.
