West Bengal Budget for 2012-13 proposes an additional taxation of 200 crore rupees!
The West Bengal Budget for 2012-13 proposes an additional taxation of 200 crore rupees. The budget placed in the State Assembly by the Finance Minister Dr. Amit Mitra on Friday shows an overall deficit of 9 crore rupees. Additional revenue proposes to be earned by increasing sales tax on country made liquor, Motor car priced above 10 lakh rupees, Television set priced above 25 thousand rupees, Mobile phones cost exceeding 20 thousand rupees, Watches priced above 15 thousand rupees and Air-conditioner with capacity above 1 ton. The West Bengal government on Friday presented a higher plan outlay of Rs23,371.44 crore in the budget for 2012-13 whose size has been estimated at Rs3,28,468 crore.
On the other hand, sales tax on a number of items have been reduced. These include payments of VAT on empty LPG cylinders, ballons, paneer, wooden box and kite sticks. Dr. Mitra in his budget speech also announced raising of exemption limit of professional tax for salaried people from 3 thousand rupees per month to 5 thousand rupees per month.
The Finance Minister proposed to setup 'Health Bank for all' to deliver Health Care System at grass-root level. The other features of the budget include Agri-production center in each block, construction of fishing harbor at Haripur, launching of new 'Karmasiksha Prakolpa' in 2 hundred schools. Dr. Mitra said that the state's total plain outlay in the next fiscal will be 23 thousand 371 crore rupees with an increases of around 12 percent than previous year.
The budget also put emphasis on employment generation and development of infrastructural facilities.
While presenting his maiden budget in the assembly on Friday, Finance Minister Amit Mitra said that the plan outlay is 11.56% higher than that of the last year.
The minister proposed to allocate an extra amount of Rs200 crore through additional resource generation through the various tax proposals.
Value-added tax (VAT) rates on balloons have been withdrawn while that on paneer reduced from 13.5% to four%.
For wooden boxes not covered in packing materials, VAT rates were reduced from 13.5% to four%, and the same proposed for small units manufacturing kite sticks.
Items where VAT rates were increased from 13.5% to 14.5% are: cars costing over Rs 10 lakh, TV sets with MRP in excess of Rs25,000, mobile phones with MRP higher than Rs20,000, watches costing more than Rs15,000 and ACs with capacity of more than one tonne.
The budget also introduced an ad valorem duty on MRP in the country liquor segment. Cess of tea is withdrawn.
Proposals taken together would garner state tax revenue of Rs31,222 crore during 2012-13.
Mitra said that through various policy measures announced in the budget, there would be an additional creation of 10,11,183 jobs. He added that the estimated total deficit in the budget is Rs9 crore.
The budget also proposed to reintroduce entry tax on goods into the state for creating a Compensatory Entry Tax Fund.
The state's budgeted tax revenue receipts is 25.2% higher than the revised estimates of 2011-12 at Rs24,934 crore.
Mitra said that in view of the recent policy decisions taken by the Centre, the state would stand to lose Rs1,800 crore of revenue in 2012-13.
As per the West Bengal Fiscal Responsibility and Budget Management (FRBM) Act prescription, the state's revenue deficit as a proportion of GSDP is projected at 1.6% in 2011-12 and 1.1% in 2012-13.
The fiscal deficit as a proportion of GSDP is projected at 3.5% both in 2011-12 and 2012-13.
The budgetary allocation to the health sector is increased from Rs871 crore to Rs1,049 crore, the agriculture sector is allocated Rs315 crore, for drinking water Rs 800 crore, for minorities welfare it is increased from Rs330 crore to Rs570 crore and school education to Rs2,713 crore.
Allocation to power (including non-conventional sources) and road sectors are raised to Rs1,010 crore and Rs1,175.42 crore, respectively, in the budget.
Outlay towards industry and IT sector are kept at Rs500 crore and Rs102.75 crore, respectively.
Budgetary allocation towards the MSME sector is put at Rs286 crore.
Union finance minister Pranab Mukherjee has made the job easier for his state counterpart Amit Mitra. West Bengal's central tax share is set to increase due to the recent hike in excise and service tax, giving Mitra a scope to manage revenues for the cash-strapped state the way the Ma-Mati-Manush government would love to do it.Times of India reports.
This is no gift from the UPA government. According to Constitution, the state government is entitled to 2.3% of the total tax collection at the Centre that is pegged at 10,77,612 crore in the budgetary estimates for the 2012-13. Going by the rule, Bengal will get as much as Rs 24,784 crore as central share of taxes, up by Rs 5,618 crore, when compared to the central tax share of Rs 19,166 crore in 2011-12 (Finance Bill). This is not a small amount because the projected increase comes to around 81.94% of the state's capital expenditure in 2011-12.
Even if Mitra increases the capital expenditure in his budget proposals on Friday, the increased share of central tax will take care of a major portion of the allocations for capital expenditure to bolster the state's development and generate jobs. This could be one reason why the Trinamool Congress - now in the seat of power in Bengal - didn't raise a din in Parliament over the hike in excise and service taxes, and gave the Union Budget a "tolerable" tag when it forced a major rollback in the proposed hike in railway fares.
This apart, the Centre has also enhanced the state's borrowing limit by Rs 2,706 crore in view of the dire state of finances. The original borrowing limit was Rs 17,828 crore. Over and above, the state has gone for an additional Rs 1,000 crore market borrowing to meet its committed expenditure.
All these may not match Mitra's demand for a three-year moratorium of Rs 22,000 crore that the state has to shell out a year as part of interest and principal of the Rs 2 lakh crore debt it inherited from the preceding Left Front government, but the increased central share of tax along with the enhanced borrowing limit is likely to give some relief to the state finance minister while carving out his budget proposals on Friday. In fact, the demand for a moratorium sounds more political than financial as Mitra's predecessor Asim Dasgupta used to harp on the pending coal cess from the Centre.
But Mitra can't do the balancing act by keeping the state tax rates intact. The Mamata government took up a number of initiatives to increase tax compliance, but the growth in commercial taxes till January was at 20%, way below the 30% target for the current financial year. Mitra has to jack up own generation to keep the revenue deficit and fiscal deficit to the commitment he made in 2010-11. In that case, a likely increase in levies on alcohol or tobacco items only won't do. The state finance minister might alter some of the VAT rates on certain luxury and semi-luxury items including broadening of the tax net to selected areas in the service sector. Some of the states have already taken these steps to step up own generation.
Troubled Galaxy Destroyed Dreams, chapter 757
Palash Biswas
The West Bengal Budget for 2012-13 proposes an additional taxation of 200 crore rupees. The budget placed in the State Assembly by the Finance Minister Dr. Amit Mitra on Friday shows an overall deficit of 9 crore rupees. Additional revenue proposes to be earned by increasing sales tax on country made liquor, Motor car priced above 10 lakh rupees, Television set priced above 25 thousand rupees, Mobile phones cost exceeding 20 thousand rupees, Watches priced above 15 thousand rupees and Air-conditioner with capacity above 1 ton. The West Bengal government on Friday presented a higher plan outlay of Rs23,371.44 crore in the budget for 2012-13 whose size has been estimated at Rs3,28,468 crore.
On the other hand, sales tax on a number of items have been reduced. These include payments of VAT on empty LPG cylinders, ballons, paneer, wooden box and kite sticks. Dr. Mitra in his budget speech also announced raising of exemption limit of professional tax for salaried people from 3 thousand rupees per month to 5 thousand rupees per month.
The Finance Minister proposed to setup 'Health Bank for all' to deliver Health Care System at grass-root level. The other features of the budget include Agri-production center in each block, construction of fishing harbor at Haripur, launching of new 'Karmasiksha Prakolpa' in 2 hundred schools. Dr. Mitra said that the state's total plain outlay in the next fiscal will be 23 thousand 371 crore rupees with an increases of around 12 percent than previous year.
The budget also put emphasis on employment generation and development of infrastructural facilities.
While presenting his maiden budget in the assembly on Friday, Finance Minister Amit Mitra said that the plan outlay is 11.56% higher than that of the last year.
The minister proposed to allocate an extra amount of Rs200 crore through additional resource generation through the various tax proposals.
Value-added tax (VAT) rates on balloons have been withdrawn while that on paneer reduced from 13.5% to four%.
For wooden boxes not covered in packing materials, VAT rates were reduced from 13.5% to four%, and the same proposed for small units manufacturing kite sticks.
Items where VAT rates were increased from 13.5% to 14.5% are: cars costing over Rs 10 lakh, TV sets with MRP in excess of Rs25,000, mobile phones with MRP higher than Rs20,000, watches costing more than Rs15,000 and ACs with capacity of more than one tonne.
The budget also introduced an ad valorem duty on MRP in the country liquor segment. Cess of tea is withdrawn.
Proposals taken together would garner state tax revenue of Rs31,222 crore during 2012-13.
Mitra said that through various policy measures announced in the budget, there would be an additional creation of 10,11,183 jobs. He added that the estimated total deficit in the budget is Rs9 crore.
The budget also proposed to reintroduce entry tax on goods into the state for creating a Compensatory Entry Tax Fund.
The state's budgeted tax revenue receipts is 25.2% higher than the revised estimates of 2011-12 at Rs24,934 crore.
Mitra said that in view of the recent policy decisions taken by the Centre, the state would stand to lose Rs1,800 crore of revenue in 2012-13.
As per the West Bengal Fiscal Responsibility and Budget Management (FRBM) Act prescription, the state's revenue deficit as a proportion of GSDP is projected at 1.6% in 2011-12 and 1.1% in 2012-13.
The fiscal deficit as a proportion of GSDP is projected at 3.5% both in 2011-12 and 2012-13.
The budgetary allocation to the health sector is increased from Rs871 crore to Rs1,049 crore, the agriculture sector is allocated Rs315 crore, for drinking water Rs 800 crore, for minorities welfare it is increased from Rs330 crore to Rs570 crore and school education to Rs2,713 crore.
Allocation to power (including non-conventional sources) and road sectors are raised to Rs1,010 crore and Rs1,175.42 crore, respectively, in the budget.
Outlay towards industry and IT sector are kept at Rs500 crore and Rs102.75 crore, respectively.
Budgetary allocation towards the MSME sector is put at Rs286 crore.
Union finance minister Pranab Mukherjee has made the job easier for his state counterpart Amit Mitra. West Bengal's central tax share is set to increase due to the recent hike in excise and service tax, giving Mitra a scope to manage revenues for the cash-strapped state the way the Ma-Mati-Manush government would love to do it.Times of India reports.
This is no gift from the UPA government. According to Constitution, the state government is entitled to 2.3% of the total tax collection at the Centre that is pegged at 10,77,612 crore in the budgetary estimates for the 2012-13. Going by the rule, Bengal will get as much as Rs 24,784 crore as central share of taxes, up by Rs 5,618 crore, when compared to the central tax share of Rs 19,166 crore in 2011-12 (Finance Bill). This is not a small amount because the projected increase comes to around 81.94% of the state's capital expenditure in 2011-12.
Even if Mitra increases the capital expenditure in his budget proposals on Friday, the increased share of central tax will take care of a major portion of the allocations for capital expenditure to bolster the state's development and generate jobs. This could be one reason why the Trinamool Congress - now in the seat of power in Bengal - didn't raise a din in Parliament over the hike in excise and service taxes, and gave the Union Budget a "tolerable" tag when it forced a major rollback in the proposed hike in railway fares.
This apart, the Centre has also enhanced the state's borrowing limit by Rs 2,706 crore in view of the dire state of finances. The original borrowing limit was Rs 17,828 crore. Over and above, the state has gone for an additional Rs 1,000 crore market borrowing to meet its committed expenditure.
All these may not match Mitra's demand for a three-year moratorium of Rs 22,000 crore that the state has to shell out a year as part of interest and principal of the Rs 2 lakh crore debt it inherited from the preceding Left Front government, but the increased central share of tax along with the enhanced borrowing limit is likely to give some relief to the state finance minister while carving out his budget proposals on Friday. In fact, the demand for a moratorium sounds more political than financial as Mitra's predecessor Asim Dasgupta used to harp on the pending coal cess from the Centre.
But Mitra can't do the balancing act by keeping the state tax rates intact. The Mamata government took up a number of initiatives to increase tax compliance, but the growth in commercial taxes till January was at 20%, way below the 30% target for the current financial year. Mitra has to jack up own generation to keep the revenue deficit and fiscal deficit to the commitment he made in 2010-11. In that case, a likely increase in levies on alcohol or tobacco items only won't do. The state finance minister might alter some of the VAT rates on certain luxury and semi-luxury items including broadening of the tax net to selected areas in the service sector. Some of the states have already taken these steps to step up own generation.
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