From Our Special Correspondent

Daijiworld Media Network

Belagavi, NOV 29: When the entire country or rather almost all citizens are facing a serious cash crunch following the November 8 demonetisation of high value currency notes, Karnataka has a comfortable cash position.

Not just comfortable cash position but the State has no necessity of availing any loans from the Reserve Bank of India (RBI).

This is the finding of Karnataka’s Mid-Year Review of State Finances 2016-17, which was tabled in the State Legislature on Tuesday.

During the first six months of FY 2016-17, the revenue surplus was Rs. 8751 crore as compared to the budget estimate of Rs. 8522 crore, reflecting a comfortable mid-year revenue position.

The revenue surplus would also be maintained at the end of FY 2016-17, the mid-year review said.

The report Mid-Year Review of State Finances 2016-17 said: "During the first half of FY 2016-17 due to the reasonably comfortable cash position, there wasn’t any necessity to operate Special Ways and Means Allowances (SWMA) or Normal Ways and Means Allowances (NWMA) from the RBI.”

Where there is a mismatch in the cash flow of the receipts and payments, the State government avails loans in the form of SWMA/MWMA from the RBI. The RBI makes payments for a period of 90 days.

The report said “as advised by RBI, additional cash balance available over and above anticipated requirements is being invested in Centre’s 91 day Auction Treasury Bills. Such investment enables the State to earn additional interest income.”

It said during the first half of 2016-17, revenue surplus was Rs. 8,751 crore with the revenue receipts of Rs. 63,373 crore and revenue expenditure of Rs. 54,622 crore. “Thus, there is a favourable mid-year balance.”

The mid-year review suggested a balanced approach while deciding on enhancing outlays.

The total revenue receipts of the State during the first six months of the financial year 2016-17 was recorded at Rs. 63,373 crore. Total receipts for the state during the first half of the year was around 16.94 per cent above during the corresponding period of 2015-16.

Collection of the State’ Own Tax Revenue, which included four major taxes —commercial taxes, excise, motor vehicle tax and taxes on stamp and registration — stood at Rs 39,762 crore in the first half of the 2016-17 against Rs 35,671 crore during the same period during 2015-16, an increase of 11.5 per cent.

A total of Rs. 24,792 crore commercial taxes, Rs. 8,063 crore excise, Rs. 2,584 crore motor vehicle taxes, Rs. 4,006 crore revenue from stamp and registration and Rs. 316 crore from other sources collected up to September 30, 2016.

With regard to devolution of funds from the Centre, the report said the receipts during the first six months of 2016-17 was Rs. 11,562 crore at 43 per cent of budget estimate of Rs. 26,979 crore.