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Gogoi's budget eyes 2016

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  11 March 2015 12:00 AM GMT

* Slew of welfare schemes in Rs 265.32 cr deficit budget

* Fiscal deficit for 2014-15 to be limited to 2.18 per cent

* Sops for women, children, cooperatives, small tea growers

* Cigarettes, liquor, swanky cars, hotel stay to cost more

By Our Staff Reporter

Guwahati, March 10: With eyes firmly set on the 2016 Assembly election a year away, Chief Minister Tarun Gogoi today presented a tax-free Rs 265.32 crore deficit budget that aims at appeasing all sections of people, but is void of a vision for achieving long-term developmental goals.

The budget, which projected a growth rate of 6.44 per cent for the next fiscal, however, lacks clarity on the roadmap for addressing key issues plaguing the State.

No tax proposal affecting the common man has been made in the budget, but the indirect taxes are likely to have an impact. There are also doubts if the people can actually derive any benefit from the tax exemptions proposed.

The budget for the year 2015-16 targets resource mobilization by strengthening tax administration and widening the tax net.

Taking into account the expenditure of Rs 1,82,440.30 crore under Public Account and Rs 100 crore under Contingency Fund, the aggregate expenditure for the year is estimated at Rs 2,48,682.47 crore. The estimated transactions during the year will result in an estimated surplus of Rs 1,609.78 crore. This together with the opening deficit of Rs 1,875.10 crore, the fincial year 2015-16 is expected to end with an estimated closing deficit of Rs 265.32 crore.

Gogoi, in his Budget speech, said an amount of Rs 2,50,292.25 crore is estimated to flow into the receipts head of the state in 2015-16, against an estimated expenditure of Rs 2,48,682.47 crore for the same period.

Of the total Rs 64,839.69 crore estimated inflow into the Consolidated Fund, 31 per cent is estimated from State Plan Grants (Rs 20,241.99 crore), followed by share of Central taxes (Rs 16,667.31 crore).

In the expenditure head, Rs 26,64,430.19 (40 per cent) has been earmarked for social services, Rs 17,87,672.89 (27 per cent economic services) and Rs 15,93,616.06 for general services (24 per cent).

Gogoi said the budget was for the poor people, the common man. “I am taxing the rich and giving relief to the poor,” he said.

Without rejecting outright the Opposition’s contention that the budget has been prepared with an eye to 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.”

He further said it was not clear how much Central funds will be given to the State and hence, the thrust was on revenue generation through the State’s own means from certain sectors, like excise.

Stating that no substantial increase in taxes affecting the common man has been proposed, Gogoi said a state-of-the-art IT-ebled 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, will be dealt with strongly and an Act will also be brought about to confiscate property of government officials who have amassed wealth disproportiote to their known means of income.

To boost the tea industry, Gogoi announced extending the benefit of Rs 6 per kg of made tea from Agricultural Income Tax if exported through Inland Container Depot at Amingaon for three more years (up to 2017-18), and increase 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 Gauhati Tea Auction Centre.

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 cigarettes to raise funds for improving health services in the state has been proposed.

A turn-over tax on the liquor consumed at the rate of 6% on the whole without any credit has been proposed.

VAT exemption has been proposed on embroidery or jari, chumki, beads, etc., glass bangles, sarees below Rs 500, pens and pencils below Rs 10, school bags less than Rs 250 and several items of sericulture and handloom.

VAT exemption has also been proposed for cancer drugs, medicil oxygen and oxygen used in hospitals.

Increasing tax on higher-end vehicles and commercial vehicles has been proposed, though the rates for lower end vehicles and small commercial vehicles will remain unchanged. Additiol resource of Rs 100 crore is targeted to be generated though this measure.

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.

Additiol resource of Rs 600 crore is targeted to be generated by increasing fees and taxes on liquor.

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