Signs of economic revival as UP revenue collection jumps 6.74% in August

After sluggish mop up in April and May, state earnings have been improved with revenue collection in July at Rs 10,675 crore, or 97% of the level achieved the same month a year ago

Indicating a robust revival of the economic activities in Uttar Pradesh post unlocking, the state government today announced 6.74 per cent growth in its revenue collection in August 2020 compared to the corresponding month the previous financial year.

Compared to a revenue kitty of about Rs 8,942 crore in August 2019, the collection in August 2020 breached the level of Rs 9,545 crore, nearly Rs 600 crore higher, UP finance minister Suresh Khanna said addressing the media here this afternoon.

After sluggish revenue collection in the initial lockdown months, particularly April and May 2020, the state earnings have been witnessing improvement with the revenue collection in July 2020, at Rs 10,675 crore, reaching nearly 97 per cent of July 2019, when the mop up had stood at about Rs 10,926 crore.

“The economic activities in UP had begun to gain momentum from July, which was also reflected in our revenue collection,” he noted. Underlining the ‘encouraging’ trajectory of collections, Khanna claimed the UP government had probably outperformed all the peer states in terms of the state earnings.

“If the economic position is good, then all the other sectors also fall into place automatically. Therefore, increasing revenue collection has been among our top priorities,” he said.

Among the major revenue heads, the collection under the Goods and Services Tax (GST) and Value Added Tax (VAT) in August 2020 stood at Rs 5,329 crore compared to Rs 5,126 crore in August 2019.

Similarly, the excise and mining department revenue mop up in August 2020 surged to Rs 2,310 crore and Rs 171 crore against Rs 1,882 crore and Rs 109 crore in August 2019 respectively.

Owing to the impact of covid-19 lockdown, against tax and non-tax revenue target of Rs 46,127 crore during Apr-June 2020, the state’s collection had stood at merely Rs 17,412 crore or 37.74 per cent of the quarterly target.

Of this, the tax revenue during Apr-June 2020 stood at Rs 15,716 crore against the target of Rs 41,602 crore, which was 37.77 per cent of the quarterly target. Similarly, the non-tax revenue mop up stood at Rs 1,696 crore or 37.5 per cent compared to Rs 4,525 crore during the Apr-June quarter of 2020-21.

However, the state government had managed paid the salaries and pensions to state employees and retired personnel on time without any deductions even when the revenue collection had hit the nadir, although there were instances of some states resorting to delays or deductions to manage the adverse financial condition arising out of the lockdown.

The Yogi Adityanath government is in the process to recalibrate revenue targets of the current financial year to incorporate lockdown impact. The state is aiming to touch last financial year’s revenue levels, although the targets set earlier were 10-15 per cent higher.