Impact of economic reforms on revenue receipts of southern States of india with special reference to tamil nadu

Abstract

Today, human development has become the focal point of public finance. On newlineaccount of this, ever increasing wants and needs in the society and also growth in newlinepopulation, the role of Government has become far and wide. Governments are newlineendowed with momentous task of providing basic minimum services like food, newlinecloth, shelter, health, education, water, sanitation etc., improving the economic newlineconditions and quality of life of the people, creating job opportunities for the ever newlinegrowing number of unemployed and under-employed people, reducing income newlineand wealth disparities in the society, infrastructure development etc. Fiscal and newlinebalance of payments crises of 1991 warranted systematic reform not only to newlineimprove the revenue productivity of the tax system to phase out fiscal imbalance, newlinebut also to reorient the tax system to the requirements of a market economy. newlineFiscal reform was the key component of the economic reform programmes which newlinestarted in the year 1991-92 and this targeted reforms in revenue structure and newlineexpenditure front. The growth of public expenditure outstripped the growth of newlinepublic revenue, leading to the widening of the government s fiscal deficit and newlinegrowing recourse to borrowing from domestic and external sources to finance this newlinedeficit. As it was difficult to compress the public expenditure immediately, so newlinetaxation being the major source of revenue of the state governments and it became newlinethe main goal of fiscal reforms to augment revenue. The four main states that newlineform the southern part of India are Andhra Pradesh, Karnataka, Kerala and Tamil newlineNadu. Hence, the growth performance of these four southern states in the pre and newlinepost reform periods is studied here on the basis of available data on tax revenue newlineand non-tax revenue. The general objective of the study is to know the impact of newlineeconomic reforms on the revenue receipts of southern states in India with special newlinereference to Tamil Nadu. The specific objectives are i) to scrutinize the growth newlinepattern of revenue receipts and its components of Tamil Nadu.