Contrary to the ‘once in a generation reforms a must’ statement made in the White Paper on the state finances, Tamil Nadu Finance Minister Palanivel Thiaga Rajan on Friday presented a relatively populist budget reducing taxes on petrol, waiver of cooperative loans to self-help groups, and tax amnesty scheme among others.
Rajan also announced the government’s decision to implement an Urban Wage Employment Scheme at an outlay of Rs 100 crore.
The DMK led by its President and Chief Minister MK Stalin came to power making about 500 poll promises and the opposition parties have been raising their voice on implementing the promises.
Presenting his first budget as the state Finance Minister, Rajan also announced the restoration of the MLA Constituency Development Scheme with Rs 3 crore per constituency from the current year onwards.
On the fuel price reduction, Rajan said the Government has decided to cut the effective rate of tax on petrol by Rs 3 per litre and thereby provide major relief to the toiling working-class people in the state. This measure will result in a loss of revenue of Rs 1,160 crore a year, he said.
According to him, the Government will waive loans to the tune of Rs 2,756 crore due from self-help groups to the co-operative credit societies and a sum of Rs 600 crore has been provided in the budget for the purpose.
He also announced the implementation of an urban wage employment scheme, on a pilot basis, to provide gainful employment to the urban poor by engaging them in the creation and maintenance of public assets like parks, playfields, stormwater drains, roads, buildings, and rejuvenation of water bodies.
A sum of Rs 100 crore has been allocated in the budget for the scheme.
In order to collect the pending tax dues of Rs 28,000 crore under the Tamil Nadu Value Added Tax and other legacy legislations, Rajan said the government will come out with an effective Samadhan Scheme the clear the tax dues.
The Finance Minister also announced the government’s decision to a major initiative for smart metering for all public utilities.
Rajan said the total revenue receipt estimates for FY22 Rs 2,02,495.89 crore and the revenue expenditure is estimated at Rs 2,61,188.57 crore resulting in a revenue deficit of Rs 58,692.68 crore.
This increase in revenue deficit is on account of the exceptional times and does not detract in the least from this Government’s commitment to fiscal rectitude and consolidation in the coming years, so emphatically indicated in the White Paper, he said.
The overall capital outlay has been fixed at Rs 42,180.97 crore. On this basis, the fiscal deficit for the financial year 2021-22 is estimated to be at Rs 92,529.43 crore.