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Having set an ambitious target of around 10% growth in revenue receipts in the next financial year, the Tamil Nadu government is pinning its hopes on four areas.
The areas are the changes in registration fee and guideline value; new strategies to improve the collection efficiency of the Goods and Services Tax (GST); plugging loopholes in the entire supply chain of liquor; and efforts to increase revenue from mineral resources.
As it has been decided to increase the guideline value, by restoring it to the rates that prevailed till June 8, 2017, and reduce the registration fee to 2%, the government hopes to see an increase in revenue by at least ₹2,000 crore to ₹2,500 crore. “The rise can be as high as ₹4,000 crore,” says one of the officials dealing with the State finances.
As a result of this measure, which is applicable to the deeds of sale, gift, exchange and non-family member settlement, registration fee will come down from 4% to 2%. In all, a property buyer will have to pay 9% (stamp duty-5% and transfer duty and registration fee-2% each) as against 11% till now. The upward revision means the hike in the guideline value by 33%.
Officials point out that the revision will be of great help to those who are planning to taking loans from formal financial institutions, because, till now, the amount of loans sanctioned does not cover much the real cost of purchase of property in view of the “artificially suppressed” guideline value.
On an average, a rise of 20%-25% is expected in transactions as well as revenue. So far, nearly 33 lakh documents have so far been registered this year; of them, sale deeds account for around 80%. This year’s revenue has so far been ₹16,600 crore.
The government has realised that though revenue through liquor sales has been on the rise, there has not been much increase in volume. As the supply chain has not been computerised, there is room for manipulation. This has compelled the government to get the operations computerised. Besides, steps will be intensified to tackle the problem of inflow of spurious liquor through inter-State borders.
The data-driven approach will be adopted to improve the GST collection efficiency, accompanied by stringent enforcement. The government has estimated that the State GST (SGST), a component of the State Own Tax Revenue (SOTR), will fetch around ₹68,000 crore next year as against the current year’s revised estimate of about ₹56,500 crore. During 2021-22, the SGST revenue was ₹46,000 crore. As for revenue from mineral resources, the government is of the view that it is getting much less than what it should, though the revenue went up from ₹983 crore in 2020-21 to ₹1,179.21 crore in 2021-22.
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