Telangana’s revenue receipts ₹38,000 crore below expectations in fiscal 2025-26, borrowings take major share

Telangana’s total revenue receipts in the previous financial year 2025-26 remained below expectations with the State reporting ₹2.6 lakh crore receipts, against estimate of ₹2.84 lakh crore, with a major chunk constituted by borrowings and other liabilities of ₹77,762 crore.

The State could achieve revenue receipts to the tune of ₹1.81 lakh crore, ₹38,000 crore less than ₹2.29 lakh crore of the budget estimates during 2025-26. The Capital receipts in the form of borrowings and other liabilities were ₹78,197 crore, which is significantly higher than the estimated ₹55,116 crore. The capital receipts included borrowings of ₹77,7762 crore.

But for State’s share of union taxes at ₹21,080 crore, 99.46% of ₹21,195 crore of budget estimates, accruals from other sources including GST, Stamps & Registration, Sales Tax and other taxes and duties remained less than 90% at the end of the fiscal.

Tax revenue during the financial year was ₹1.52 lakh crore, 87.72% of the ₹1.75 lakh crore of the budget estimates. Of this, revenue through GST was ₹52,375 crore (₹59,704 crore BE), Stamps & Registrations was ₹15,251 crore (₹19,087 crore BE) and State Excise Duties ₹23,359 crore (₹27,623 crore BE).

Revenue through Grants-in-Aid and contributions remained below par at ₹10,422 crore, 45.75% of the ₹22,782 crore projected in the budget estimates. Interestingly, non-tax revenue which remained sluggish for 11 months at ₹9,105 crore grew to ₹18,986 crore with ₹9,881 crore collected in March alone.

Expenditure

On the expenditure side, interest payments — largely due to the loans raised by the previous government — mounted to ₹29,679 crore at the end of March. This was 153% of ₹19,369 crore projected in the budget estimates while expenditure on pensions too was on the higher side at ₹19,371 crore, 147% of ₹13,109 crore of the budget estimates.

Expenditure on salaries

Expenditure on salaries/wages has been another drag on the finances at ₹47,400 crore, 106% of ₹44,478 crore of the budget estimates. The rise assumes significance as the State Government is yet to clear close to five instalments of the dearness allowance (DA) pending and the persistent demand for implementation of the Pay Revision Commission (PRC) recommendations from the employees.

Revenue deficit

Overall, the year ended with a revenue deficit of ₹9,235 crore against ₹2,738 crore surplus projected in the budget estimates and the fiscal deficit which was made good through borrowings was ₹77,762 crore against ₹54,009 crore estimated. The primary deficit at the end of the fiscal stood at ₹48,082 crore, 138% of ₹34,640 crore estimated for the year.