‘Assam faces bleak future due to uncertain Central funding’
Guwahati: Assam chief minister and finance minister Tarun Gogoi on Tuesday presented a Rs 265.32 crore deficit budget for the fiscal 2015-16 for the ‘common man’ that also aims at augmenting internal resource mobilisation at the expense of the rich.
Presenting the budget Gogoi vowed to get tough with tax evasion and to bring about an Act to confiscate property of government officials who have amassed wealth disproportionate to their known means of income. Stating that no substantial increase in taxes affecting the common man has been proposed, Gogoi said a state-of-the-art IT-enabled taxation system with online tax compliance facilities will be introduced to arrest leakages, which could raise the tax collection by 4-5 per cent (to the tune of about Rs 350 crore during 2015-16).
The CM said black marketers and government officials helping such elements would be dealt with strongly and a legislation would be enacted for the purpose. No tax proposal affecting the common man has been made in the budget, while resou-rce mobilization is being targeted by strengthening the tax administration and widening the tax net.
Gogoi said the budget was meant to provide succour to the poor people and the common man. “I am
taxing the rich and giving relief to the poor.” He said it was not clear how much Central funds would be given to the state and hence thrust had been given on revenue generation through own means from certain sectors, like excise. A turn-over tax on the liquor consumed at the rate of 6% on the whole without any credit has been proposed. Additional resource of Rs 600 crore is targeted to be generated by increasing fees and taxes on liquor.
Without rejecting that opposition’s reaction that the budget was prepared with an eye on next year’s Assembly elections, the CM said, “I do not say it is not an election-oriented budget, but I want to help the poor with it. Any budget which helps the poor is perceived as a populist one.” Giving a boost to the state’s tea industry , Gogoi announced continuation of exemption of payment of agriculture income tax at the rate of Rs 6 per kg of made tea, if exported through Inland Container Depot at Amingaon here for three more years (up to 2017-18). He also announced increa-sing the VAT on private sale of tea from 1% to 2% while retaining the current rate of 0.5% of VAT on auction
sale in Guwahati Tea Auction Centre.
VAT exemption has been proposed for cancer drugs, medicinal oxygen and oxygen used in hospitals. While according industry status to the Hotel industry, it has been proposed to increase the existing slab of
luxury tax on room tariff. A cess of Re 1 per pack of cigarette to raise funds for improving health services in the state has been proposed.VAT exemption has been proposed on embroidery or jari, chumki, beads, etc., glass bangles, sarees below Rs 500, pens and pencils less Rs 10 and school bags less than Rs 250 and several items of sericulture and handloom.
Increasing tax on higher-end and commercial vehi-cles has been proposed, though the rates for lower end vehicles and small commercial vehicles remai-ned unchanged. Additional resource of Rs 100 crore is targeted to be generated though this.An amount of Rs 100 crore is targeted to be generated in 2015-16 by increasing royalty rates on
minor minerals, dealt by the forest department.
While a revenue surplus of Rs 5501.25 crore is estimated for 2015-16, opening deficit of Rs 1875.10 crore for the next fiscal has led the closing deficit to be estimated at Rs 265.32 crore. An amount of Rs 250292.25 crore is estimated to flow into the receipts head of the state in 2015-16, against an estimated expenditure of Rs 248682.47 crore for the same period.
Of the total Rs 64839.69 crore estimated inflow into the consolidated fund, 31 per cent is estimated from State Plan Grants (Rs 20241.99 crore), followed by share of Central taxes (Rs 16667.31 crore). In the expenditure head, Rs 2664430.19 (40 per cent) has been earmarked for social services, Rs 1787672.89 (27 per cent economic services) and Rs 1593616.06 for gene-ral services (24 per cent).
Assam Chief Minister Tarun Gogoi today slammed the Centre while presenting the Budget for 2015-16, saying uncertainties in financial support for many schemes has created a ‘bleak future’ for the state. “With uncertainties in the pattern of assistance for many schemes and programmes, states such as Assam, whose revenue base is limited, face a bleak future,” Gogoi said in his Budget speech at the Assembly here. Indications of abrupt changes in the policies and planning by the Central government in a manner that appear to ignore the special requirements of the state have created uncertainty and many apprehensions, he added. “Of late, the indications are that the principle of assistance to special category states is being diluted.
Some schemes have been proposed with higher state share while central share is proposed to be withdrawn altogether for some ongoing important schemes and socially significant programmes. “Such abrupt change in policy by the Centre would not only leave the ongoing schemes in a state of uncertainty and possibly deprive millions of poor but also disrupt the efforts of special category states like Assam towards growth,” Gogoi said.
He pointed out that concern has been raised by members in the House cutting across political affiliations during the current session itself. Gogoi, who also holds the Finance portfolio, said Assam suffers from the annual cycle of floods and erosion, causing loss of human life, crops and livestock and damages to infrastructure like roads and bridges. “We lose nearly 8,000 hectares of arable land every year due to erosion. Since independence, the state has lost nearly four lakh hectares. This amounts to 7.4 per cent of its area in Brahmaputra valley alone,” he added.
Gogoi said the state government shall leave no stone unturned to bring the parameters of development on par with the rest of India, or even surpass, but “now we are not clear who would support us in bridging this gap”.
“At current prices, our per capita income is Rs 46,354 as against the all India average of Rs 74,920. This gap shall have to be bridged so that there is equitable development in the country… But, this can happen only with active support of the Centre whereby funds flow in and additional wealth and capital get generated,” he added. The chief minister said the financial difficulties of the states get further compounded as they do not even get a fair recompense for the natural resources they possess and this impedes their ability to raise their own resources.
He said crude oil is a prized resources of Assam, but the state loses substantial revenue as the Centre pays royalty on the basis of heavily discounted price arrived on the basis of the price fixing formula intended to lower the cost of feed stock to various users.(With inputs from PTI)