Telangana’s financial struggles continued for the fifth consecutive month in the current fiscal year (2025-26). By the end of August, the state had collected only ₹96,654 crore in total revenue receipts, representing a mere 33.93% of the ₹2.84 lakh crore anticipated in the budget.
What are Total Receipts?
Total receipts encompass both revenue receipts and capital receipts. Capital receipts specifically include funds from loan recoveries, advances, new borrowings, and other liabilities.
A significant portion of these total receipts, ₹33,415 crore, came from borrowings and other liabilities. This amount already accounts for 61.87% of the ₹54,009 crore limit set by the Union Finance Ministry under the Fiscal Responsibility and Budget Management (FRBM) Act.
Delving deeper, tax revenue, a component of revenue receipts, showed a slightly better performance at ₹59,967 crore, achieving 34.2% of the ₹1.75 lakh crore budget projection. However, non-tax revenues lagged significantly at just ₹1,578 crore, a paltry 4.99% of the ₹31,618 crore estimated for the fiscal year. Similarly, grants-in-aid and contributions were sluggish, reaching only ₹1,673 crore, or 7.35% of the projected ₹22,782 crore.
Understanding Revenue Receipts
Revenue receipts are funds a government collects from tax revenue, non-tax revenue, and grants-in-aid and contributions. Key tax revenue streams include Goods and Services Tax (GST), Stamps and Registration fees, Land Revenue, Sales Tax, State Excise Duties, and the State’s share of Union taxes. Non-tax revenue primarily consists of interest earned on loans and dividends from investments.
On a more positive note, the state’s share of Union taxes was a commendable ₹7,413 crore, hitting 40.32% of the ₹18,384 crore fiscal estimate. Goods and Services Tax (GST) revenue over the first five months amounted to ₹21,144 crore, or 35.42% of the ₹59,704 crore budget projection. Collections from the Stamps and Registration department reached ₹6,218 crore, achieving 32.58% of its ₹19,087 crore target.
Significant Expenditure
Regarding expenditures, interest payments remain a substantial burden, totaling ₹11,447 crore by the end of August, which is 59.1% of the ₹19,369 crore projected for the entire fiscal year. Provisional figures submitted to the Comptroller and Auditor General of India also show that the government allocated ₹20,141 crore for salaries and wages. Pension payments were also notably high at ₹7,701 crore, already reaching 58.75% of the ₹13,109 crore annual projection with seven months still remaining in the fiscal period.
High Subsidy Outlay
The state government disbursed ₹7,492 crore in subsidies, accounting for 45.84% of the ₹16,345 crore budget. A major portion of this subsidy was directed towards providing free power to the agricultural sector.
By August end, Telangana recorded a revenue deficit of ₹11,051 crore, a stark contrast to the projected annual surplus of ₹2,738 crore. The fiscal deficit reached ₹33,415 crore. Furthermore, the primary deficit for this five-month period stood at ₹21,967 crore, already 63.42% of the ₹34,640 crore anticipated for the entire fiscal year.