Telangana, Andhra Pradesh overcome shortfall in GST revenue collection

Hyderabad: The Telugu states are on the verge of overcoming their shortfall of GST revenue collections. Both the state governments faced a revenue deficit after the launch of the new tax regime in July.

Within three months the revenue collection has improved drastically and the gap between revenue estimates and actual realisation has narrowed down to less than 10 per cent.

Only five states in the country have achieved this feat, of which two are Telangana state and Andhra Pradesh.

According to figures released by Centre for three months from August to October, the revenue projection of TS was estimated at Rs 5,235 crore, but Rs 4,365 crore was realised, a deficit of Rs 872 crore.

The projection for AP was Rs 4,369 crore, but the realisation was Rs 3,603 crore, a deficit of Rs 766 crore. The gap between estimates and actuals of TS and AP was less than 10 per cent. The situation is better when compared with other states.

As many as nine states have registered a deficit of 20 per cent to 30 per cent and six states 40 per cent to 50 per cent.

As per GST norms, states which get less revenue than the projected figures will get compensation. Accordingly, TS and AP will get lower compensation than other states.

These projections were made by taking 2015-16 as the base year. If the growth rate of revenue collection is less than 14 per cent now when compared with 2015-16, the Centre offered to bear the losses for the next five years. It has agreed to repay the losses to states every two months.