Revenue Receipts of the Government of Assam

The government has multifaceted responsibilities in bringing about overall development of the society. Therefore, the government has to depend on multiple sources for raising the required resources to perform its roles effectively. The receipts of the government may be classified as Revenue Receipts and Capital Receipts. The present study has been undertaken with the objective of studying the composition of revenue receipts of the Government of Assam and examining the trend of revenue receipts vis-à-vis total receipts of the Government of Assam. INTRODUCTION: The government has multifaceted responsibilities to achieve the objective of maximizing the welfare of the people by providing for education, health, social security and various other facilities indispensable for satisfying physiological and social needs. It has also to make provision for improved infrastructural facilities for the economic growth and development of the nation to make a niche for itself in the global context. To discharge its responsibilities, the government has to play a parental role in the overall development of the society. In the light of the above discussion, it becomes imperative for the government to raise funds. Because of the multi-dimensional role of the government, the resource requirement is also large. Therefore, the government has to depend on multiple sources for raising the required resources to perform its roles effectively. The North Eastern region, one of the strategic regions of India, with seven vibrant states, each having distinct social, cultural and economic indicators, needs fruits of development along with the rest of the country. Assam is a Special Category State situated in this region. The State’s Gross Domestic Product (GSDP) at current prices during 2011-12 was Rs. 1,15,408 crore (base year 2004-05). The state government needs more funds to enable development initiatives in the region across diverse sectors. The receipts of the Assam government may be broadly studied under two heads: Revenue Receipts and Capital Receipts. The present paper is an attempt to study the revenue receipts of the Government of Assam and various matters incidental thereto. Revenue receipts of the Government of Assam includes proceeds of taxes and other duties levied by the Government of Assam, share of central taxes received from the Central Government, interest and dividend on investments made by the government, fees and other receipts for services rendered by the government, non-taxable sources  such as government-owned corporations’ incomes and grants-in-aid from the Government of India. Having considered the aforesaid matters, we now propose to lay down the objectives of the present study. OBJECTIVES OF THE PRESENT STUDY: The present study has been undertaken with the following objectives: 1. To study the composition of revenue receipts of the Government of Assam; 2. To examine the trend of revenue receipts vis-à-vis total receipts of the Government of Assam. METHODOLOGY: The study is mainly based on secondary sources of information. The researchers have collected information chiefly from the Annual Financial Statements, the Finance Accounts and the Report of the Comptroller and Auditor General of India on State Finances of the Government of Assam. The data so collected have been tabulated and inferences drawn therefrom. Statistical tools like line diagram, bar diagram and pie charts, have been used extensively to give a bird’s eye view of the tabulated data. For the purpose of the present study a period of eight years has been taken. The period covered is from the year 2004-05 to 2011-12. In consonance with Objective No. 1 as stated above, we shall now undertake a study on the composition of revenue receipts of the Government of Assam. COMPOSITION OF REVENUE RECEIPTS: The composition of the state’s revenue speaks about the financing pattern of government expenditure in Assam. The receipts of the state may be classified into revenue and capital. The revenue receipts of the state mainly comprises of tax and non-tax revenue and share of union taxes or duties and central grants. The central transfers to the state come from various channels such as Finance and Planning Commission of India and other discretionary transfers for central sector scheme and centrally sponsored schemes. There was drastic change in the grants to loan composition of Planning Commission’s transfers from 30:70 to 90:10 after Assam was declared as a special category state in 1990-91. On the other hand, Finance Commission transfers to the state is mainly guided by various efficiency and equity criteria such as income (distance method), population (1971), area, index of infrastructure, fiscal discipline and tax effort etc. On the other hand, the capital receipts consists of recoveries of loans and advances, public debt receipts, contingency fund, public account receipts, contingency fund and miscellaneous capital receipts. Hereunder, we present the composition of revenue receipts of the Government of Assam for the period 2004-05 to 201112 in Table 1 followed by Chart 1 and Chart 2 which depict the trend of the same.


INTRODUCTION:
The government has multifaceted responsibilities to achieve the objective of maximizing the welfare of the people by providing for education, health, social security and various other facilities indispensable for satisfying physiological and social needs. It has also to make provision for improved infrastructural facilities for the economic growth and development of the nation to make a niche for itself in the global context. To discharge its responsibilities, the government has to play a parental role in the overall development of the society.
In the light of the above discussion, it becomes imperative for the government to raise funds. Because of the multi-dimensional role of the government, the resource requirement is also large. Therefore, the government has to depend on multiple sources for raising the required resources to perform its roles effectively.
The North Eastern region, one of the strategic regions of India, with seven vibrant states, each having distinct social, cultural and economic indicators, needs fruits of development along with the rest of the country. Assam is a Special Category State situated in this region. The State's Gross Domestic Product (GSDP) at current prices during 2011-12 was Rs. 1,15,408 crore (base year 2004-05). The state government needs more funds to enable development initiatives in the region across diverse sectors. The receipts of the Assam government may be broadly studied under two heads: Revenue Receipts and Capital Receipts.
The present paper is an attempt to study the revenue receipts of the Government of Assam and various matters incidental thereto. Revenue receipts of the Government of Assam includes proceeds of taxes and other duties levied by the Government of Assam, share of central taxes received from the Central Government, interest and dividend on investments made by the government, fees and other receipts for services rendered by the government, non-taxable sources such as government-owned corporations' incomes and grants-in-aid from the Government of India.
Having considered the aforesaid matters, we now propose to lay down the objectives of the present study.

OBJECTIVES OF THE PRESENT STUDY:
The present study has been undertaken with the following objectives: 1. To study the composition of revenue receipts of the Gov-ernment of Assam; 2. To examine the trend of revenue receipts vis-à-vis total receipts of the Government of Assam.

METHODOLOGY:
The study is mainly based on secondary sources of information. The researchers have collected information chiefly from the Annual Financial Statements, the Finance Accounts and the Report of the Comptroller and Auditor General of India on State Finances of the Government of Assam.
The data so collected have been tabulated and inferences drawn therefrom. Statistical tools like line diagram, bar diagram and pie charts, have been used extensively to give a bird's eye view of the tabulated data.
For the purpose of the present study a period of eight years has been taken. The period covered is from the year 2004-05 to 2011-12. In consonance with Objective No. 1 as stated above, we shall now undertake a study on the composition of revenue receipts of the Government of Assam.

COMPOSITION OF REVENUE RECEIPTS:
The composition of the state's revenue speaks about the financing pattern of government expenditure in Assam. The receipts of the state may be classified into revenue and capital. The revenue receipts of the state mainly comprises of tax and non-tax revenue and share of union taxes or duties and central grants. On the other hand, the capital receipts consists of recoveries of loans and advances, public debt receipts, contingency fund, public account receipts, contingency fund and miscellaneous capital receipts.
Hereunder, we present the composition of revenue receipts of the Government of Assam for the period 2004-05 to 2011-12 in Table 1 followed by Chart 1 and Chart 2 which depict the trend of the same.
research PaPer Having considered the composition and trend of revenue receipts, we shall now examine the trend of revenue receipts vis-à-vis total receipts of the Government of Assam in consonance with Objective No.2.

RECEIPTS OF THE GOVERNMENT OF ASSAM:
Revenue and capital are the two streams of receipts that constitute the resources of the state government. Hereunder, we present the revenue receipts of the Government of Assam vis-à-vis the total receipts for the period 2004-05 to 2011-12 in a tabular form (Table 2). The percentage contribution of different components of state revenue receipts for the period 1990-91 to 2011-12 has been presented in Table 3. It is evident from Table 3 that central transfers constitute a major portion of the Assam's total revenue during the study period. On an average, central revenue transfers has been contributing more than 60 percent of the total revenue of the state except in the year 1993-94. The compound growth rate of central transfers has been found to be higher than the state's own revenue for the study period. This situation reflects the dependence of the state on central transfers as well as the inability of the state to carry out developmental works with its own resources. However, some improvements have been observed in own revenue generation of the state during the time period 2000-01 to 2011-12 compared to the previous decade.