Punjab is in for revenue loss of Rs 22,000 Crore for the FY 2019-20 on account of COVID-19 crisis. The grim fact emerged at the meeting of the Finance Sub-Committee set up recently by Chief Minister Captain Amarinder Singh to take stock of the fiscal implications of the pandemic.
Finance Minister Manpreet Badal informed the meeting that of the Rs 88,000 Crore revenue receipts estimated to be raised for the current fiscal, only Rs 66,000 Crore would now be generated in the light of the curfew/lockdown, which had brought all business, tax receipts etc to a standstill besides resulting in lower GST collections.
After the meeting, all Punjab ministers voluntarily decided to donate their full salaries, for the next three months, to the CM’s Covid Relief Fund even as the Chief Secretary Karan Avtar Singh appealed all government employees to take voluntary cuts in the wages to help the state meet the unprecedented contingency.
The Chief Secretary issued an appeal asking “all government employees, and all employees of PSUs, local bodies, Boards and corporations, to volunteer to contribute their pay and allowance to the government mission to combat COVID-19” on the directives of the Chief Minister, who was not in favour of imposing any salary cuts on employees.
The Chief Secretary suggested that grade A& B employees should contribute 30%, grade C should contribute 20% and grade D should contribute 10% of their monthly emoluments for April, May and June 2020 to the CM’s Relief Fund to strengthen the government’s efforts to deal with the deadly pandemic and the huge losses resulting from the current crisis.
The meeting discussed several measures to mop up revenue in the prevailing situation, due to which the state was witnessing a massive financial crunch, that was likely to continue for another couple of quarters at least. The Chief Minister urged the committee members to look at innovative measures to tackle the crisis.
The FM also apprised the meeting that with all manufacturing/production almost completely shut, and no taxes/duties forthcoming on account of Transport/Excise/Stamp Duty etc, the state was set to lose out on Rs 22000 crore against revenue receipts. With GST collections to be much lower during the year and with the Centre yet to clear a significant amount of the state’s pending GST arrears, things will continue to worsen in the coming months, he warned.
The state is also yet to receive any special financial package towards COVID relief from the Centre, he pointed out.
The Sub-Committee will meet again in a day or two to further discuss measures to generate more revenue and cut down expenses across departments to meet the costs for COVID related medical and relief operations, in addition to the routine government expenditure.