Gujarat interim budget: Central grant dips, but state banks on rising tax collection

Gujarat interim budget: Central grant dips, but state banks on rising tax collection

Gujarat’s economic growth rate stood at 9.9% , highest among major developing states, said Deputy CM

Gujarat interim budget: Central grant dips, but state banks on rising tax collection
Deputy Chief Minister Nitin Patel. (File photo)

Though the BJP government in Gujarat did not hike taxes in its Interim Budget, citing surge in tax collection, the revised estimates presented by Deputy Chief Minister Nitin Patel in his Budget document on Tuesday shows that the grant-in-aid and contribution from the Central government for the year 2018-19 is expected to dip by Rs 845 crore in comparison to the previous year.

The Budget document shows that the contribution from central government for the year 2017-18 stood at Rs 15,885 crore. However, the revised estimates for the current fiscal show that the revenue from the Centre is expected to be Rs 15,040 crore — a drop of Rs 845 crore.

When pointed out, Additional Chief Secretary (Finance Department) Arvind Agarwal played it down saying, “there is still one and half months left for the 2018-19 fiscal year to end. “More central grants are yet to come. The final figures for 2018-19 have not been presented,” he asserted.

Sops for all in Gujarat’s Interim Budget, focus on fishermen, farmers

The Budget estimates for the year 2019-20 show that this quantum of Central grants is expected to rise to Rs 15,641 crore. However, it still remains below the figures clocked in 2017-18.


Meanwhile, speaking to mediapersons after presenting the Budget, the Deputy CM, who also holds the Finance portfolio, said that “effective steps of tax compliance and tax collection attributed to rise in state’s own tax income by over 11 per cent”.

“In the financial year 2016-17, state government’s own tax income was Rs 64,443 crore , which increased to Rs 71,5149 crore in the year 2017-18,” Patel said, attributing the rise in income from stamp duty collections, motor vehicle tax and electricity duty. “The stamp duty collection increased from Rs 5,783 crore to Rs 7,255 crore. Similarly, the income from motor vehicle tax increased from Rs 3,213 crore to Rs 3,885 crore, and the income from electricity duty increased from Rs 5,833 crore to Rs 6,484 crore,” Patel added.

In his Budget speech, Patel also said that during the five years, between 2013 and 2017, Gujarat’s average annual economic growth rate stood at 9.9 per cent at constant prices, “the highest among major states”. “Keeping the momentum, the state’s economy registered a growth of 11.2 per cent during 2017-18,” he said.

Gujarat’s Gross State Domestic Product, which stood at Rs 13.15 lakh crore during 2017-18, has shown a 14 per cent growth compared to the previous year. He also said that Gujarat’s per capital income (at current prices) rose by 12.6 per cent in 2017-18.

By cutting funds to state, Modi has betrayed Gujarat: Congress

Highlighting the fall in the Central grants to the state, Leader of Opposition Paresh Dhanani said that Prime Minister Narendra Modi has betrayed Gujarat. “As chief minister of Gujarat, Modi always levelled allegations of discrimination in allocation of funds to the state by the Congress-led UPA government. But the BJP-led central government with Modi as its PM has not allocated any funds for Gujarat in the last two years, and the state government has not raised this question at all… This is like slapping the people of Gujarat,” said Dhanani.

“Modi may have forgotten his allegations, but the people of Gujarat have not,” he added. Deputy Leader of Opposition Shailesh Parmar termed the Budget “hopeless”,
saying, “Farmers were expecting a farm loan waiver but it was not announced. Youth were expecting new job announcements but there was nothing on it.”