With the 2016 state assembly elections in mind, Assam chief minister Tarun Gogoi on Tuesday presented a pro-poor, pro-women budget with a minimum deficit of just about Rs 26.32 crores, in the process also promising to fill up 65,000 vacancies, provide cash assistance to one lakh women self-help groups and 1.26 lakh farmers, and reducing power bill for over 37 lakh consumers in the state.
Gogoi’s budget particularly focused on women – definitely intending to touch every family –, announcing a separate development authority for women and children, financial assistance to one lakh women self-help groups (each group comprising 10 women), as also to unmarried women, widows, women cooperatives, and reserving 30 per cent posts of constables for women.
He also proposed exemption of embroidery, jari, chumki, beads, glass bangles, and sarees below Rs 500 from VAT, and reduction of VAT on local handmade jewellery, school bags, pens and pencils costing less than Rs 10 per piece, and fully exempt HDPE cocoon crates, plastic harvest boxes, silkworm rearing trays, these benefiting thousands of artisans and silk-worm rearers in the tribal area. Cancer drugs and hospital oxygen have been also fully exempted from VAT, he said.
Gogoi’s last budget in his third consecutive term as chief minister also eyed over 80,000 small tea growers who produce about 30 per cent of the state’s tea, and proposed to amend the welfare policy for these tea growers. He also proposed providing funds to self-help groups of small tea growers to set up small tea factories, as also small cold storage units for storing green leaf during the peak cropping season.
On the taxation front, Gogoi also proposed to raise luxury tax on hotel rooms with rent above Rs 2000, impose a cess of Rs 1 per pack of cigarettes, 6 per cent turn-over tax on liquor bars, raise tax on costlier pre-owned cars and one-time tax on four-wheelers costing more than Rs 12 lakh. Annual motor vehicle tax on commercial vehicles including omni tourist buses, deluxe/super express buses and contract carriages have been also raised, he said.
Gogoi also proposed to raise rates of royalty on 17 various minor minerals, impose a levy of Rs 500 per truck carrying coal from other states through Assam, increase licence fee and application fee and increase fees and taxes on liquor too.
Uncertainty in flow of central resources
Chief minister Gogoi in his budget speech expressed concern over reduction of Central share in various schemes like RKVY, NHM, RMSA and ICDS, and feared that this would lead to major disruption in implementation of these schemes. As a result, states would hardly have scope to use their own resources for state-specific schemes, he said.
“I am perplexed at this version of (the BJP government’s) fiscal federalism as with the reduction of Central share, following which states would have to increase spending their own funds. In such case, there would not be much room for the states to implement their own schemes without major disruptions due to sudden cessation of many on-going developmental programmes,” he said.
He also expressed concern over “indications” that the BJP government at the Centre would dilute the principle of assistance to special category states, and said the Central share for some on-going important schemes are being proposed to be withdrawn altogether.
“Such abrupt change in policy by the central government would not only leave the on-going schemes in a state of uncertainty and possibly deprive millions or poor, but also disrupt the efforts of special category states like Assam towards growth,” the Assam chief minister said.