Kerala govt presents annual budget, focuses on fiscal discipline

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Bengaluru: Kerala’s ruling Left front government presented its annual budget on Friday calling for “severe fiscal discipline” by not announcing any major fresh projects and mooting steps to increase revenue, such as raising tax on the fair price of land by 10% and that on Indian-Made Foreign Liquor, priced above Rs400, by 200% and doubling the price of beer.

The budget, the first after the rollout of goods and services tax (GST) which took away most of the powers of taxation from the state’s hand, also sharply criticised the implementation of the new tax regime.

The state is reeling under a revenue shortage and growing expenditure, a situation that has been made worse by the centre’s failure to effectively administer the rollout of GST and transfer the share of GST revenues to the states, said finance minister Thomas Isaac. The finance minister likened the GST rollout to the recent attack of cyclone Ockhi, which claimed 77 lives after hitting Kerala shores on 30 November. “The only difference is one was natural and the other was man-made,” he said.

Other highlights of the budget include a Rs2,000 crore allocation for coastal area development in the wake of the destruction caused by Ockhi, and a Rs3,500 crore loan for reviving the ailing Kerala Road Transport Corp.

Isaac also pledged to expand widely the use of a sewer-cleaning robot that was recently developed by a home-grown startup to end manual scavenging. In order to be gender-sensitive, Isaac said, 14.6% of the total budget is allocated for projects that will help women. The funding for schemes that will benefit women exclusively is Rs1,267 crore. These include schemes to create exclusive industrial parks and build shelter, among others.

Another Rs10 crore has been allocated for projects that will exclusively benefit the transgender community. There is also a separate allocation of Rs2,859 crore for projects to benefit the scheduled castes and scheduled tribes, who form 9.1% and 1.45%, respectively, of the total population, constituting about 9.8% of the total budget.

The budget has also announced a set of new initiatives to cut short state expenditure that includes discouraging departments from buying new luxury cars that cost above Rs14 lakh and promoting the use of rental cars and cab aggregators instead of using own cars for travel.

The finance minister also wants public officials to use video conferencing more so as to reduce travel expenses. Foreign trips will be allowed only if they are absolutely necessary, he said.

The government offices are also asked to consider switching away from high-cost landline telephones to low-cost mobile connections to cut the bills. The creation of new government posts, as well as allowing new grants for aided institutions, will be judicious.livemint