Rs 1 lakh crore cess, surcharge may go unspent in FY23

NEW DELHI: Even as the Centre’s collections through Cesses and surcharges have increased significantly over the past few years, a lot of the fund so collected remains unutilized. Data presented in parliament by the finance ministry shows that the Rs 99,000 crore collected through Cess and surcharges will go unutilized in the current financial year.

This is much higher than Rs 58,000 crore that remained unutilized in 2021-22. In the next financial year, the unutilized amount might go up to Rs 1.3 lakh crore.The finance ministry has informed parliament that revenue from Cess and Surcharge (excluding GST compensation cess) would double in 2023-24 to Rs 4.2 lakh crore from Rs 2.1 lakh crore in 2018-19, showing a 14.5% annual growth in the past five years.

The government is likely to collect Rs 3.98 lakh crore via cess and surcharges, but would spend Rs 2.99 lakh crore in the current fiscal. As per the government’s budget estimate for the next financial year, it would spend only Rs 2.87 lakh crore against a collection of Rs 4.2 lakh crore in 2023-24. Of the Rs 3.98 lakh crore spent in 2022-23, primary and higher education accounted for Rs 62,000 crore, but a significant chunk (Rs 2.08 lakh crore) went to construction of roads and infrastructure.

Surcharges and cesses are collected for specific purposes, and the amount thus collected is transferred to respective reserve funds created for the intended purposes.However, it has often been found that not all of amount collected through such levies are transferred to the reserve funds, and instead being retained in the

Consolidated Fund of India unutilised. Since Surcharges and Cesses are not part of the Centre’s tax pool which is shared with the states, many state governments have raised concerns over growing share of such levies in Centre’s gross tax collection. The share of surcharges and cesses in the Centre’s gross revenue has gone up from 8.6% in 2010-11 to 13% (excluding GST compensation Cess) in 2022-23.