CAG Report Flags Revenue Deficit for Telangana
CAG report shows sharp drop in receipts, rising expenses deepen state’s fiscal woes
Hyderabad: Telangana has plunged into a revenue deficit in the very first month of the new financial year 2025-26, according to a report released by the Comptroller and Auditor General of India (CAG) on Thursday. The CAG data for April 2025 revealed that the state posted a revenue deficit of Rs 4,023.11 crore, a significant contrast to the revenue surplus of Rs 1,020 crore recorded in April 2024.
As per the report, Telangana’s total revenue receipts in April 2025 stood at Rs 11,239.13 crore, while revenue expenditure touched Rs 15,262.24 crore. The widening gap between receipts and expenditure has led to a deepening revenue deficit scenario for the state.
A major chunk of the expenditure was allocated towards committed liabilities, with Rs 3,968.42 crore spent on salaries, Rs 2,260.74 crore on interest payments, Rs 1,569.86 crore on pensions and Rs 4,187.73 crore towards subsidies.
The revenue receipts also witnessed a decline compared to the previous year. In April 2024, revenue receipts were Rs 11,818.88 crore, which dropped to Rs 11,239.13 crore in April 2025. Meanwhile, revenue expenditure rose sharply from Rs 10,798.33 crore in April 2024 to Rs 15,262.24 crore in April 2025.
Borrowings formed a significant portion of the receipts, with loans totaling Rs 5,230.99 crore. These accounted for nearly the entire capital receipts of Rs 5,234.86 crore for the month. Of the Rs 11,239.13 crore revenue receipts, tax revenue contributed Rs 10,916.68 crore and non-tax revenue was a mere Rs 253.60 crore.
Under the tax revenue segment, GST fetched Rs 4,054.14 crore, sales tax Rs 2,703.57 crore, stamps and registration fees Rs 1,126.18 crore, excise duties Rs 1,288 crore, the state’s share of central taxes Rs 1,096.31 crore and other taxes Rs 648.27 crore. Central grants-in-aid made up Rs 68.85 crore of the non-tax revenues.
The overall expenditure of the state government in April 2025 stood at Rs 16,466.63 crore. Consequently, the fiscal deficit widened to Rs 5,230.99 crore in April 2025, up from Rs 2,246.62 crore during the same period last year.
For the financial year 2025-26, the state has estimated revenue receipts at Rs 2,29,720.62 crore. However, in April, it was able to realise Rs 11,239.13 crore. In terms of non-tax revenue, only Rs 253.60 crore was collected out of the projected Rs 31,618.77 crore, amounting to a mere 0.80 per cent. The alarming increase in revenue and fiscal deficit, coupled with falling receipts and rising committed expenditure, signals a challenging fiscal road ahead for the state in 2025-26.