Govt bullish on non-tax revenue growth

NON-TAX REVENUE: Major contribution expected from auction of spectrum freed by Supreme Court?s cancellation of 122 2G licences

The government has projected a 32 per cent jump in non-tax revenue receipts at Rs 1,64,614 crore in 2012-13, against the 2011-12 revised estimate of Rs 1,24,737 crore, thanks largely to the auction of the spectrum to be freed up after the Supreme Court verdict cancelling 122 2G telecom licences.

With a fiscal deficit target of 5.1 per cent of GDP, the government is banking heavily on spectrum auction, along with disinvestment, to improve cash flow at the end of 2012-13. According to economic affairs secretary R Gopalan, the spectrum auction slated for 2012-13 is expected to contribute Rs 40,000 crore to the revenue expectation of Rs 58,217 crore, over three and half times more than the 2011-12 revised estimate of Rs 16,551 crore.

Receipts under other communication services mainly relate to the licence fees from telecom operators, receipts on account of spectrum usage charges and auction of broadband wireless access (BWA) spectrum, currently in use by central PSUs, receipts from spectrum held in excess of 6.2 MHz and those from auction of spectrum available with the government, including spectrum to be vacated by the 122 cancelled licencees.

The other significant contributor to non-tax revenue would be dividends and profits from PSUs, which has seen a substantial increase in 2011-12. Dividend and profits from PSUs are targeted at Rs 50,152 crore, against the 2011-12 revised estimate of Rs 50,122 crore.

The non-tax revenue of the government includes revenue receipts from sources such as return on assets in the form of dividend and profits, interest, fees, fines and receipts collected in the exercise of sovereign functions, regulatory charges and licence fees, and user charges for publicly provided goods and services.

With this, the non-debt capital receipts at Rs 41,650 crore, which includes the Rs 30,000-crore disinvestment amount, would be 40 per cent higher than the 2011-12 revised estimate of Rs 29,751 crore.

The 2011-12 Budget estimate for this segment was Rs 55,020 cr, with a disinvestment target of Rs 40,000 crore. Finance secretary R S Gujral said at a post-Budget media interaction that in 2011-12, the government was expecting about Rs 14,000 cr from PSU stake sale; but stressed that given the extended ambit of disinvestment, a Rs 30,000-crore target for 2012-13 was conservative.

The temporary arrangement to use disinvestment proceeds for capital expenditure in social sector schemes rather than transferring them to the national investment fund has also been extended one more year to 2012-13.