CHENNAI: Tamil Nadu’s value of uncollected tax and non-tax revenue rose to Rs 44,289.54 crore as of March 31, 2023, up 12.6% from the previous year, highlighting persistent weaknesses in assessment, recovery and audit follow-up across key departments.
More than half the arrears, Rs 22,595 crore, have remained unpaid for over five years, according to the latest Compliance Audit (Revenue) Report of the CAG.
Taxes on sales, trade and related levies account for the largest share at Rs 26,932 crore, of which Rs 17,163 crore is over five years old. While portions are under court stay, insolvency proceedings or recovery certificates, over Rs 7,275 crore remains at various stages of recovery.
State GST arrears stood at Rs 7,973 crore, with nearly half under litigation or recovery proceedings. Legacy dues from mining and metallurgical industries totalled Rs 8,040 crore, including Rs 4,399 crore pending for more than five years. Electricity tax arrears amounted to Rs 669 crore, two-thirds long-pending, while stamp duty and registration fee arrears stood at Rs 438 crore, largely under recovery certificates.
Despite procedural steps such as issuing recovery certificates and pursuing court cases, the audit said the scale of aged arrears reflects weak collection efficiency and called for time-bound recovery measures to prevent further accumulation. The report also flagged a sharp rise in pending GST assessments. While 22,026 state GST cases were pending at the start of 2022–23, another 1.16 lakh cases became due during the year. Although over 83,000 assessments were completed, closing pendency more than doubled to 54,413 cases. By contrast, pendency under central sales tax and other legacy levies fell sharply to 47 cases.
Warning that delays in GST assessments could undermine enforcement and revenue realisation, the audit urged the Commercial Taxes department to accelerate disposals.
During 2022–23, the department detected over 31,000 new SGST evasion cases, taking the total caseload to 32,706. Assessments were completed in nearly 31,000 cases, raising additional tax and penalty demands of Rs 12,291 crore.