As digitisation takes the centre stage, especially with the onset of the COVID pandemic, a need for digital solutions for optimising revenue management is realised. Considering the fact, technologies like advanced data analytics and AI have played a crucial role in revolutionising revenue management. Addressing this, Dr Prithvi Raj, Secretary, Finance (Budget), Government of Rajasthan participated in the Revenue Management and Intelligence Summit 2021 organised by Elets Technomedia Pvt. Ltd. on May 5, 2021.
“Firstly, from the past one and a half years, the state governments and the private sector have been in financial stress owing to the COVID pandemic. Last year when the pandemic occurred, there was a revenue dip of 30 per cent. The losses were also faced by the Centre. This created a panic situation among the government departments,” said Dr Prithvi Raj, as he commenced his address. Hence, to find out ways to compensate the losses and apart from the contribution from the Centre or the grants, etc. that became a major challenge for all the state governments, he added.
Speaking on ways to enhance a state government’s revenue, Dr Prithvi Raj mentions two ways, “Firstly, finding new avenues for revenue enhancement which is difficult, the other is incrementally improving revenue-generating avenues. Here comes the role of data analytics or various technology tools to explore such ways.” So, apart from GST, there is mining, stamps, transport department, excise, petroleum and other departments that generate revenues. Therefore exploring these avenues to enhance revenue generation was imperative, he said.
Around three to four years back we had installed data analytics in the Department of Information and Technology. Also, we have a separate State Department of Revenue Intelligence (SDRI). We have installed SAS software in our government departments. The SAS systems are being majorly used by SDRI to understand e-transactions, fraudulent transactions happening in the GST, and ways to recover. Apart from that, we use the software to analyse the data from mining and transportation departments. Analytics helped the mining department to generate revenue of Rs 11,000 crore in 2018-2019. This year the state witnessed a 25 per cent growth in mining revenue, Dr Prithvi Raj highlighted.
Addressing the need for government officers to be digitally literate to a certain level to operate such software solutions, he said, “Myself work on various programmes for government processes. I have a decent knowledge of tools like R and Python but the SAS software is what I find the most comfortable and user-friendly. Moreover, one can get the software tailor-made as well.”
On innovations in the revenue sector, he said, “Without the use of analytics, Excise and VAT generated Rs 6500 crore. However, with the use of analytics and new techniques, VAT and Excise generated Rs 13,000 crore in just two years, doubling the overall revenue.” Further, even if the revenue from only country liquor is considered, it was Rs 2100 crore earlier, whereas, a revenue of Rs 4100 crore was generated last year.
“Similarly, we took initiatives to augment the revenue collection in stamps and registration stamps showed 25-30 per cent growth month on month. Finally, against a projected deficit of 30 per cent, State is only at a deficit of two per cent.”
Describing the reason behind his achievements, Dr Prithvi Raj said, “So, we achieved these figures by not just brainstorming about solutions to increment but we changed the system when needed. Therefore, we took approval from the government to install new technology software and system and within a year the numbers grew significantly. To reach out to this conclusion of inducting better technology, we studied operations of other states, we used data, tried to understand people’s perception and their behaviour towards government systems, and studied the market.” Fortunately in the State of Rajasthan, most of the departments have their own software and data collections systems. However, the key problem is that all the departments are working in silos. They need to come together in an integrated environment to work, he added.
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Dr Prithvi Raj said, “If we look at the revenue intelligence agency of the Government of India, it is seen that they do revenue intelligence for income tax and other types of taxes and even for GST. Probably, a similar revenue intelligence setup exists only in two states of the country – Karnataka and Rajasthan.” Such a dedicated team comes in handy to ensure effective revenue management, he added.
While concluding his address, Dr Prithvi Raj emphasised the need to have a Revenue Intelligence unit and the significance of technology tools, SAS software, and data analytics not only for boosting revenue but also for augmenting its management effectively.