Mumbai: The economic slowdown is expected to deflate Maharashtra Government's Sales Tax/VAT and GST target for 2019-20 of Rs 39378 crore and Rs 113260 crore, respectively.
The state finance department, in its presentation to Chief Minister Uddhav Thackeray, has indicated that there will be a shortfall of about Rs 10,000 crore to Rs 15,000 crore, if the economy continues to flounder.
The finance department has also hinted that the fall in state GST and sales tax/VAT will result in capital expenditure constraints, which will impinge on development projects. GST and sales/VAT together constitute nearly 67% of the State's tax revenue, which is estimated at Rs 2.10 lakh crore plus.
Already the dip in consumption of petrol and diesel has impacted the sales tax/VAT collection. Further, the diminishing growth in manufacturing and core sectors, especially automobile, has adversely impacted the GST collection.
Only in October, due to festive demand, there was a slight pick-up but the finance department said this won't be the situation in the coming months, unless there is an economic revival.
A state finance department officer told the FJP, ''The total tax revenue of Maharashtra is pegged at Rs 2,10,824 crore plus in the 2019-20 estimate. The tax to GSDP ratio target is 7.1% in 2019-20."
