Maha task to fund farm loan waiver in Maharashtra
By Abhijit Mulye | Published: 18th June 2017 10:17 AM |
MUMBAI: The Maharashtra government has decided to raise its income by recovering over Rs 72,000 crore of pending taxes to finance its loan waiver scheme. However, the task won’t be easy looking at the lukewarm response to the amnesty scheme announced by the government earlier this year.
Though the eligibility criteria for beneficiaries of loan waiver are yet to be finalised, guesstimates show that the total burden of the loan waiver on the state could range from around Rs 22,000 crore to Rs 37,000 crore.
Finance Minister Sudhir Mungantiwar announced after the decision of loan waiver that the funds needed to finance the scheme would be raised through various means such as increasing non-tax revenue, pooling up PLA funds with the state-owned corporations into a separate Non-Banking Finance Corporation and recovery of pending tax dues.
The state had put forth a target of raising non-tax revenue from the current level of around Rs 15,000 crore to Rs 26,000 crore. However, the finance department data shows that the government machinery had failed to recover Rs 3,192 crore from non-tax revenue sources last year. With this kind of performance, the target to raise the non-tax revenue by around Rs 11,000 crore appears challenging. Same is the case with the recovery of around Rs 72,000 crore of revenue through taxes.
While a major part of the unrecovered sum—over Rs 51,170 crore—is stuck in legal disputes, over Rs 21,630 crore hasn’t been recovered because of the lax approach and staff shortage.
The amount to be recovered was Rs 51,643 crore until 2013-14, but as the government failed to recover dues amounting to Rs 11,264 crore, the figure rose to Rs 62,907 crore in 2014-15. It now stands at Rs 72,800.
The state government announced amnesty scheme during the budget session this year to recover the tax dues worth around Rs 20,000 crore. But it could achieve only around a 10th of its target in the past couple of months.
Around 70 per cent of the pending tax dues are from the sales tax department. Other dues are from taxes on vehicles, land revenues, minor minerals, entry taxes, among others.
The state has the burden of over Rs 4 lakh crore of loan. The revenue deficit stands at over Rs 4,500 crore. In addition to this, the state government will have to prepare itself for giving the Seventh Pay Commission dues and revised salaries to its employees.
The amount for that is expected to be around Rs 15,000 crore. All these underline the need of raising funds to be able to push through the loan waiver for over 31 lakh farmers. “To be able to do it fast, a new out-of-court settlement policy is likely to be adopted in the case of dues under legal disputes,” a senior official from the Finance Department told The Sunday Standard.