CAG rebukes UP for high cost of tax collection
The Comptroller and Auditor General (CAG) rebuked the Uttar Pradesh government for higher cost of tax collection as compared to the national average.
As per the the CAG Report:
- Gross collections related to trade tax/VAT receipts during 2008-09, 2009-10 and 2010-11 stands at Rs 17,482 crore, Rs 20,825 crore and Rs 24,836 crore respectively, on which respective cost of collection borne was Rs 272 crore, Rs 358 crore and Rs 406 crore respectively. Cost of gross collection in during these years found at 1.56, 1.72 and 1.64 % in UP whereas the national average is 0.83, 0.88 and 0.96 % respectively.
- There is an increasing trend in generation of UP’s own revenues during 2006-11 period.
- Ratio of Tax revenue to Gross State Domestic Product (GSDP) remained constant around 7 %
- Ration of non-tax revenue to GSDP significantly decreased from 2.77% in 2009-10 to 1.90 % in 2010-11.
- UP’s GSDP stands at about Rs 588,000 crore (at current prices) during 2010-11.
- The debt-GSDP ratio is at 38 % at the end of 2010-11 is on lower side, especially in view of the target of Fiscal Responsibility and Budget Management (second amendment) Act 2011 to contain it to 42 per cent by the end of 2014-15.
- Nearly 92 %of borrowed funds in UP used for discharging debt liabilities during 2008-11.
- The state maintains a sinking fund, but it may not be adequate for amortization of loans.
- UP’s fiscal outlook showed improvement in 2010-11. Despite reduction in revenue surplus by Rs 3,539 crore, the fiscal deficit reduced to 2.93% of GSDP during 2010-11 due to low capital expenditure over the previous year.
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Month: Current Affairs - June, 2012