16 States’ revenues in April-November FY24 grow by a moderate 5%

Combined revenue receipts of 16 State governments recorded “shallow” growth of about 5 per cent during the April-November period of the current financial year, much lower than the budgeted 17.4 per cent, according to a report by rating agency ICRA.

The contraction in Sales Tax and lower-than-budgeted growth of State Goods and Services Tax collections (SGST), Excise Duty and Stamps and Registrations (S&R) Duties during the first eight months of FY24 restricted the growth of the States’ own tax revenues to around 11 per cent, the report said.

The 16 States selected for analysis exclude the North-East, the hill States, Goa and Bihar.

 In the first eight months of FY24, the combined SGST, Excise Duty and S&R collections of the 16 States expanded by a moderate 10-12 per cent, according to the report. However, the States’ Sales Tax collections contracted by 1.4 per cent, limiting the growth of States’ own tax revenues.

A steep decline in grants from the Centre during April-November also impacted the States. Grants of 13 of the 16 States contracted during the period, resulting in a combined drop of about 31 per cent, against 19.8 per cent growth in the Budget Estimate (BE).

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