Infra push in surplus Budget

CHENNAI: Augmentation of fiscal resources, big push for infrastructure development, poverty eradication, skill buil­ding and removal of regio­nal disparities in growth rate of different parts of the State are key aspects of the Rs 2,376.07 crore surplus budget for Tamil Nadu for 2012-13.Presenting his second budget in the State Assembly on Monday, Finance Minister O Panneerselvam proposed new taxes to the tune of Rs 1,500 crore, but without hurting the common man. The Minister also announced complete tax exemption on many vital items used by the public such as wheat, oats, insulin, helmets, feeding bottles and nipples and hand-made locks.Value-added tax (VAT) on electrically operated two wheelers (e-bikes), compact fluorescent lamps, including compact fluorescent tubes, and splints and veneers used by the matchstick industry would be reduced from 14.5 per cent to five per cent.Panneerselvam proposed hiking VAT on liquor sold in bars, hotels and restaurants to 14.5 per cent, withdrawing VAT exemption on vegetable oils and rationalising taxes on tourist taxis, maxicabs, priv­ate service vehicles and construction equipment vehicle­s, besides doubling the charges on blocking of fancy vehicles registration numbers. The Minister also announ­ced the implementation of revised guideline valuation for properties with effect from April 1, 2012.Stating that the fina­nces of the State were in shambles when this government assumed office 10 months ago, the Minister pointed out that its sagacious steps for fiscal consolidation had improved the fiscal scenario in 2011-12 to reflect a revenue surplus of Rs 536.54 crore.Pegging the fiscal deficit for 2012-13 at Rs 19,832.13 crore (2.87 % of the Gross State Domestic Product or GSDP), Panneerselvam observed that it was within 3% of the GSDP, which is as per norms for fiscal prudence set by the 13th Finance Commission.The Minister said the budget estimates for 2012-13 have been designed to further improve the financial position of the State government. While revenue receipts are projected at Rs 1,00,589.92 crore of which the State’s own tax revenue would contribute Rs 71,460.55 crore, the State’s non-tax revenue would be Rs 6,032.61 crore. The share in central taxes is estimated at Rs 15,032.47 crore and grants-in-aid from the Centre are estimated at Rs 8,064.29 crore.On the increasin­g fiscal deficit, Finance Secret­ary K Shanmugam said, “It is quite common and it is a good sign also. All this money is spent only on developmental works. It is bad to have revenue deficit. On that count, we have shown revenue surplus for the past two years.”He pointed out that in tune with the promise of CM J Jayalalithaa that State’s debt burden would be controlled, the net borrowing for 2011-12 was cut. Though the net borrowing was projected as 16,105.86 crore in the revised budget estimate for 2011-12, it was limited to Rs 12,873 crore.