Mumbai : Maharashtra Chief Minister Devendra Fadnavis on several occasions has said that his government aspires to make the state a one trillion economy by 2025. But at present the economics do not support that aspiration and these mounting concerns have resulted in the Fifteenth Finance Commission visiting the state.
The commission will visit the state from September 17 to 19, 2018. The commission will focus on declining revenues of the state among other issues. The state could not maintain the momentum of growth of revenue receipts during 2009-13 to 2014-17.
The growth in revenue receipts declined from 17.69 per cent during 2009-13 to 11.05 per cent in 2014-17. The state’s own tax revenue declined from 19.44 per cent in 2009-13 to 8.16 per cent in 2014-17. There is no way GST can be blamed here. The press note issued by the finance ministry said, “GST could well be a game- changer in this respect. No revenue loss to the state on implementation of GST. The tax to GSDP ratio for the State stands at about 6.24, which is far lesser than other comparable, large-sized developed states.” While the ministry lauded the state for better fiscal management, but decline in revenue is of concern.
“Yet, a revenue deficit of 0.5 per cent of GSDP continues to be a worrisome factor for Maharashtra; the revenue deficit to GSDP ratio has increased even as the fiscal deficit to GSDP ratio has fallen,” stated the ministry note.The ministry also pointed out that the state is not just suffering from economic disparity but also social disparity.The ministry added that the fifth state finance commission (SFC) recommendations are ideally required to be implemented from 2014-15 onwards, and it appears in case of Maharashtra the report of the fourth SFC is still pending.The commission had already held a consultation meeting with various economists in Pune in the month of August to understand the issues in the region.