3 min readChandigarhMar 6, 2009 12:26 AM IST
First published on: Mar 6, 2009 at 12:26 AM IST
Though the heat of economic slowdown has seen its value-added tax (VAT) growth rate plunge to 26.8 per cent in February 2009 from nearly 39 per cent till October last year,the agrarian economy of Punjab is still doing better than the others.
As the financial year 2008-09 inches to its end,Punjab has maintained its robust tax collections and ranks third in VAT growth rate in the country from ninth till last year and 24th the year ahead.
While Punjab is aiming at ending the year with Rs 7,000 crore from VAT and Rs 2,000 crore from excise (against Rs 1,757 crore last year),robust tax collections are not the only reason to cheer for the cash-starved Punjab. Its Housing and Urban Development Department has proved to be the new money-spinner,showing highest growth rate in revenue among government departments this year by adding a whopping Rs 3,500 crore to the state coffers.
Coming from a department,which so far contributed not more than 10 per cent of this amount (Rs 250 crore) to the state revenue,the windfall is owing to government making a kill through auctions. Nearly two-third of the revenue (Rs 2,600 crore) has come from sale of government properties,including those under the controversial Optimum Utilisation of Vacant Government Lands (OUVGL) scheme. External development charges (EDC) and change of land use (CLU) fee account for the remaining Rs 900 crore.
Though the government could not encash on what it termed as “timely and wise encashment of market conditions” in the latter half of the year due to changed market conditions,notably,all receipts from the auctions have gone to the consolidated fund of the state. At least 70 more sites had been identified in towns and cities,both under the possession of the Punjab Urban Development Authority (PUDA) and not yet under PUDA possession,for auctions last year with as many as 10 sites in Jalandhar and seven each in Patiala and Kapurthala and five in Ludhiana.
As for VAT,Punjab is hoping that good minimum support price (MSP) for its two major crops of wheat and paddy will ensure that the tempo of high growth continues. “We will be given the target for 2009-10 by the Finance Department shortly and would endeavour to take the growth rate higher next year,” says Financial Commissioner,Excise and Taxation,SS Brar,adding that though the VAT growth rate has dropped since November,they have already collected up to Rs 6,500 crore till February and will end the year beyond the Rs 7,000-crore mark.
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