Shutdown set to hit Telangana State finances hard

Hyderabad: The Telangana government has pegged a revenue loss of nearly Rs 500 crore a day after the trade and economic activity bore the brunt of coronavirus menace.

As a precautionary measure, official ban on certain business practices, mainly the closure of theatres and shutdown of function halls, bars, clubs for a period of two weeks, is likely to have an adverse impact on the state economy in the current financial year ending on March 31.

Steep fall in footfall in big malls, restaurants and other business establishments, decline in tourist visits to the state particularly Hyderabad and famous pilgrimage centres in districts like Yadadri Laxminarasimha Swamy temple, etc, affected the revenues.

"Under the GST, state directly earns revenues (SGST) from the hospitality services and other commercial activity. A 50 percent dip per day in the revenue earnings has been estimated by the officials.

The State Commercial Taxes department, headed by Chief Secretary Somesh Kumar, is reviewing the negative impact of the coronavirus on the state economy on a daily basis, the officials said, adding that Chief Minister K Chandrashekar Rao is closely monitoring the situation.

Stagnation in the entire business activity is visible in every sector. Cinema halls and function halls in Hyderabad are one of the main sources of revenues to the state.

The closure of entire entertainment industry and asking people to postpone functions left the state in dire straits and the cascading effect will also be seen on the transport industry. The current crisis will also take a toll on the livelihoods of thousands of workers in the coming days.

The officials said the recovery of revenue loss incurred by the state is a big challenge before the government which is struggling hard to meet the financial needs of the state ever since the country is in the troubled waters under the influence of the economic recession that hit the world last year.