BENGALURU: Karnataka has kicked off the financial year with a significant increase in its tax revenue in the first quarter over the previous year on the back of fewer Covid-related restrictions and an increase in overall economic activity.
For the quarter ending June 30, Karnataka earned Rs 23,177 crore in own tax revenue — 58% more than in Q1 of the previous year — with commercial taxes & stamps and registration fees raking in 61% and 65% more than the previous year, respectively.
In July and August, the state’s exchequer earned Rs 20,266 crore, pushing the revenue in the first five months of the fiscal to Rs 43,000 crore. This is 43% more than Rs 30,429 crore earned in the first five months of the previous year. The government has raked in Rs 3,922 crore from non-tax revenue in the April-August period, which is 103% more than it earned for the like period last year.
TAX REVENUE UP
Hope third wave won’t hurt: FICCI member
Of this Rs 3,922 crore, 56% was earned in the first quarter, which compared to the same period last year was nearly 120% more.
Pointing out that overall economic activity has picked up, J Crasta, member, national executive committee, FICCI, said: “MSMEs are struggling as PSU banks are not lending enough and there are huge inventories and labour problems. While we believe the coming quarter will be better, we hope the third wave doesn’t hurt us.”
While experts admitted the high growth could be attributed to low-base effect, finance department officials said the earnings this year are in line with the government target.
Karnataka’s revenue target from its own taxes for the fiscal is Rs 1.1 lakh crore and with around 40% (five of the 12 months) of the year complete already, the state has earned around 39% or Rs 43,443 crore of the revenue.
Analysis of source-wise data shows the government has already got 41% of the target set for commercial taxes, while excise has earned 41.5%. However, revenue from motor vehicles stands at 29% of the target, while stamps and registrations is at 36%.
“We are hopeful of these two sectors increasing further in this quarter (ending September 30) and the next one. By December end, we believe they would also be closer to the target,” one of the officials said.
The state’s non-tax revenue for the fiscal is Rs 8,258 crore and it has already got 47.5% of the same and is expected to achieve 100% collection before March.
