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Positive signs on State's revenue front

C. Gouridasan Nair

Rise in both tax and non-tax revenue and capital expenditure seen

State's revenue receipts almost doubled
Non-Plan expenditure shows increasing trend

THIRUVANANTHAPURAM:Despite hiccups in finance management and slip-ups in meeting deficit targets, Kerala has acquitted itself well during the 2004-09 period, according to the Comptroller and Auditor General (CAG) of India.

In its report on State finances, tabled in the Assembly on Friday, the CAG has found encouraging signs in State's own revenue mobilisation and in capital expenditure during the period, particularly during 2008-09.

According to the report, the State's revenue receipts almost doubled from Rs.13,500 crore in 2004-05 to Rs.24,512 crore in 2008-09, exhibiting relative stability in the share of its various components.

The State's tax revenue registered a 17 per cent increase during 2008-09 touching Rs.15,990 crore as compared to Rs.13,669 crore the previous year. Taxes on sales, trade, etc., were the major sources of the State's own tax revenue during the year constituting 71 per cent of the total revenue, followed by stamps and registration fees (13 per cent), State excise (9 per cent) and taxes on vehicles (6 per cent).

Tax collection

Tax revenue exceeded the budget estimates for the year by Rs.209.33 crore. This was mainly due to the increase in taxes on sales and trade (Rs.760.74 crore) and State excise (Rs.97.79 crore).

However, the tax revenue collected during 2008-09 fell short of the normative assessment made by the Twelfth Finance Commission (Rs.16,612.37 crore) by Rs.622.19 crore.

On the non-tax front, the revenue increased by Rs.349 crore (29 per cent) from Rs.1,210 crore in 2007-08 to Rs.1,559 crore in 2008-09. Non-tax revenue sources mainly comprised receipts from forestry and wildlife (14 per cent), State lotteries (31 per cent) and interest receipts, dividends and profits (8 per cent).

The increase was mainly due to State lotteries (Rs.156 crore).

Revenue expenditure

On the expenditure side, the revenue expenditure increased in absolute terms from Rs.17,169 crore in 2004-05 to Rs.28,224 crore in 2008-09 but its percentage to total expenditure decreased from 95 to 91 per cent, indicating an increase in the percentage of capital expenditure from Rs.682 crore in 2004-05 to Rs.1,696 crore in 2008-09. The percentage of capital expenditure in the total expenditure thus increased from 4 per cent to 6 per cent.

Non-Plan revenue expenditure also showed an increasing trend during the period 2004-09, with 2008-09 registering a 10.6 per cent (Rs.2,397 crore) increase over the previous year.

The increase was mainly due to the increase in expenditure under general education (Rs.679 crore), family welfare (Rs.126 crore), police (Rs.154 crore), roads and bridges (Rs.321 crore) and interest payments (Rs.330 crore), the CAG's report says.

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