Cong-NCP unveils sop-heavy budget

Shaken by its defeat in 25 out of the 48 Lok Sabha seats, the Congress-NCP government has chosen not to effect a hike in taxes. Rather, it has cut levies on consumer goods. Sales tax on consumer goods has been brought down to 8 per cent from an average 13 per cent. Special development packages of Rs 1,500 crore have been announced for various underdeveloped areas, particularly those where the ruling coalition received a drubbing in the general elections. A special package of Rs 452 crore has been unveiled for 87 drought-prone talukas in the Western Ghats.

The government has also decided to bear the burden of 50 per cent premium payable by 20 lakh small and marginal farmers for crop insurance. Cheaper electricity will also be provided to farmers who pay regular bills at the rate of 25 paise per unit. And cane farmers, who form a significant votebank for both Congress and NCP, are exempted from the sugarcane purchase tax.

Given the sheer range and cost of the concessions, critics dubbed many of the proposals as ‘‘impractical’’ announcements that were unlikely to be realised. ‘‘This budget is the Democratic Front’s election manifesto which will never be implemented. It fools the common people,’’ said Shiv Sena leader Narayan Rane.

The business community also benefited from the election year largesse. About 1 lakh small traders will henceforth not come under the scanner of the sales tax department. They would not be required to register themselves with the department and maintain books of accounts and file returns.

For the manufacturing sector, the government has decided to eliminate tax on locally purchased raw materials for the next three years. As of now, it ranges from 3 to 6 per cent. In the first year, it will be brought down by one per cent.

The backward classes, whose votes did not land in the Congress-NCP kitty in several areas, are being wooed with land at heavily subsidised rates apart from low interest loans to be disbursed to 20,000 backward class youths for self employment. Patil also announced a six per cent increase in the 55 per cent dearness allowance of government staff. Half of the DA will be merged with the salary.

For policemen, refreshment allowances up to sub inspector level has been doubled while daily allowance up to the rank of inspectors in lieu of weekly off has been increased by 50 per cent.