‘I do not propose to raise any new taxes’: CM Rio

Growth of State’s Own Tax Revenue as per the Statements under The Nagaland Fiscal Responsibility and Budget Management Act, 2005 laid in the Nagaland Legislative Assembly along with the Budget 2021-22.

Growth of State’s Own Tax Revenue as per the Statements under The Nagaland Fiscal Responsibility and Budget Management Act, 2005 laid in the Nagaland Legislative Assembly along with the Budget 2021-22.

Says taking measures to mobilize additional revenue

Our Correspondent
Kohima | February 18

Chief Minister Neiphiu Rio today said that in view of the difficult situation that the state is facing now, “I do not propose to raise any new taxes. However, we have to make all possible efforts to increase revenue collections through measures such as better enforcement and steps to check leakage of revenue.”

As a part of this exercise, instructions have been issued to all Government departments not to award any supply orders or works contract to the firms or contractors who are not registered with the Taxes Department to reduce scope for evasion of taxes. Efforts are also being made in sectors like Forests and Geology and Mining to tighten up control and supervision of the Government agencies over the trade in minerals and different natural resources, Rio said.

Realising revenue and payments of power bills from consumers has always been a challenge for the Power Department, Rio said adding that shortfalls in spending against revenue have always been met from the budget, which otherwise could have been used for more productive capital expenditure.

The defaulters in payment of power bills include Government departments and Government employees. The Government will work to put in place a system to deduct at source the pending amounts of the defaulters from the government payments due to them, Rio said.

Rio said that the Power sector is incurring heavy losses that are no longer acceptable. Against an amount of Rs 407 crore spent on power purchase during 2019-20, the revenue earned was Rs 159 crore only.

During the current financial year, against power purchase of Rs 452 crore, we are expected to get about Rs175 crore only, Rio said adding that “This shows how serious the problem has become. The situation has been similar since 2010 with our revenue realisation being less than 50 percent of the expenditure on power purchase since 2010-11.Over the coming years, with increasing consumption this is going to increase only.”

 We have too many consumers who are not paying for the power they consume. A number of reform measures are in process, which include outsourcing the functions of metering, billing and collection of revenue for electricity in a few districts so that we can bring in private sector efficiencies in this area and improve collection of power dues, Rio said.
 The arrangement will gradually be extended to all district headquarters.

As a part of the efforts to improve revenue realization, the department is implementing pre-paid metering system where installation for 10,000 consumers in Dimapur and 9000 in Kohima are in advanced stage. This will be expanded gradually, he said.

Rio said that it is time to have a relook at the communitisation of the power sector.

In the Forest sector, measures are being taken to tighten and improve enforcement to increase forest royalty collections, he said.

The Geology and Mining sector is also moving to generate more revenue through upward revision of royalty rates. It is also taking steps for better regulation of the minor minerals industries.

In the Transport sector also steps are being taken to enhance revenue mobilisation through various measures. In order to support private enterprise, create meaningful employment and reduce public spending we will support establishment of private transport companies in the service sector.

New initiatives are also being taken up in the Land Revenue Department, while revenue sharing models with source owners and village authorities in the Water Supply sector will aim to enhance efficiency and accountability, and make the activities more participatory, Rio stated.