Claims on conforming to fiscal roadmap merely based on optimistic projections
Presenting his maiden Budget on Wednesday,Finance Minister Parminder Singh Dhindsa was at his candid best hinting that taxes may follow. The FM,who summed up his Budget speech saying the state will require additional resources of at least Rs 2,000 crore to fulfill poll promises and the Rs 14,000-crore annual plan,pegged the saving from austerity cuts to Rs 250 crore.
Later,while he answered queries of mediapersons,Dhindsa said the finance department has drawn up a list of resource mobilisation measures,but these will only imposed once both the alliance partners,SAD and BJP,reach a consensus and the cabinet clears them. I never said it is a tax-free Budget. How else are we to raise the additional resources of Rs 2,000 crore? A decision could not be taken owing to the civic polls and later,due to the absence of Deputy Chief Minister Sukhbir Badal (he also heads the excise and taxation department), he said.
Dhindsa added that the decision to give tablets instead of laptops to students is based on both usability and austerity. We will get them made to order by incorporating all additional features that are required, he said.
However,though he spoke of rising debt,interest payments and committed expenditure,Dhindsas Budget failed to explain how the mounting revenue deficit will be reigned in to conform to fiscal roadmap prescribed by the 13th Finance Commission,despite higher revenue expenditure and no resource mobilisation measures.
Barely two months ago,the projections of the Punjab government were much higher when the Badal government presented a vote on account. The total expenditure for 2012-13 was 28 per cent higher than previous year,taking the states fiscal deficit to Rs 12,683 crore and revenue deficit Rs 9,179 crore the states highest ever.
The revenue deficit in 2011-12,by the FMs own admission,had shot up from the targeted Rs 3,379 crore to Rs 6,838 crore,surpassing the Finance Commissions yardstick of 1.8 per cent of the GSDP. For 2012-13,the Budget pegs it to a unrealistic Rs 3,123 crore. Dhindsa attributed the slippage in revenue deficit last year to rising salary,pension and subsidy bill,no resource mobilisation and moderate VAT collections.
Our VAT collections last year were not on the expected lines. Our projection for this year is much higher, he said. The other optimistic projection the low deficit is based on is austerity cuts,which the Budget pegs to a mere Rs 250 crore. The state has also projected higher collections under stamp and registration and excise,though it has been falling short of meeting the set targets each year.
Bitter tablet for people,taxes after budget: Cong
Stating that the budget was merely a statement of fudged accounts,Leader of Opposition Sunil Jakhar on Wednesday said the financial document failed to provide any new direction for the state.
I congratulate Finance Minister Parminder Singh Dhindsa for making a candid confession that Punjabs interest payment to revenue receipts ratio is one of the highest in the country, Jakhar said.
He accused the government of fooling the people after promising them the moon. After promising laptops they are giving tablets. They should have called it a bitter tablet or bitter pill. A state study had put the figure of unemployed youth at 46 lakh and so the Rs 1,000 for just graduates registered for three years with employment exchanges is a cruel joke, he said.
Jakhar said indications were clear that the government was being conservative in terms of taxes due to the Dasuya bypoll. Taxes will follow after the Dasuya bypoll. They will bring in new levies such as property tax. New power tariffs are also to be announced by the regulatory commission. They are talking of raising Rs 13,000 crore more debt. How can the revenue deficit go down drastically to Rs 3,000 crore this year when it shot up to Rs 6,800 crore last year. The revenue deficit to GSDP ratio has improved owing to higher GSDP from high minimum support price for crops, he added.
Bikram Singh Majithia
People friendly and development oriented budget…despite having limited financial resources,SAD-BJP has not imposed any new tax…the government has put the state on accelerated growth by fetching big investments in various sectors…the budget has fixed a fresh target to generate Rs 500 crore through revenue income resources.
Captain Amarinder SinghPPCC President
More of a political than a financial statement which concealed more than it revealed. This budget has a hidden taxation agenda which this government will reveal very soon…the budget has betrayed the inefficiency of this government with a debt of Rs 78,236 crore…the government will go for punitive taxation after the Dasuya by-election which amounts to fraud with the people. If we have to borrow money to pay salaries and interest we can imagine what the state of economy of Punjab is.
Under the economic scenario of inflationary trends and devaluation of the rupee,the budget presented by Dhindsa is a progressive one which gives a push to every sector without burdening the people of Punjab with new taxes.
SAD-BJP has not fulfilled any of the promised in their poll manifesto announced before Assembly elections…it had promised new laptops but replaced them with tablets…it had announced Rs 1,000 as unemployment allowance to unemployed youth but changed its decision by giving it to institutes when youths enrol to upgrade their skills. They said no new taxes would be imposed but Dhindsa called a press conference after todays Vidhan Sabha session to say that taxes to the tune of Rs 2000 crore will be imposed.
Punjab budget promises future taxation,is deceitful and carries a hidden purpose that will be revealed in the coming days…it defies all financial logic…how is this government going to make up the revenue-expenditure gap of over Rs 3000 crore. The government will impose taxes through the back-door. The budget has nothing for infrastructure development or welfare schemes.
CII Punjab chairman
Although the budget proposes no new taxes on the exchequer,it falls short of industry expectations. After agriculture,industry is the backbone of the state and cannot be ignored. The budget contains no incentive for new investment in state.