Thiruvananthapuram, February 3,( BPNS )
The cash strapped state government has passed the buck of revenue generation on the common man. The State Budget 2023-24, presented by KN Balagopal on Friday, has come as a blow below the belt for the layman as it proposed many revisions including the introduction of a social security cess on sale of petrol and diesel at the rate of Rs 2 per litre.
For a state which is already reeling under skyrocketing prices of essential commodities ranging from rice to vegetables, the social security cess for fuel has come as a shocker. The common man is of the fear it might worsen the situation.
Ironically, Balagopal had announced an amount of ₹ 2,000 crore for 2023-2024 to continue vigorous market interventions, considering that the threat of inflation has not completely abated in the state.
It was after citing the financial commitment to the tune of Rs 11,000 crore per annum for social security that the finance minister proposed social security cess towards liquor and fuel. The additional revenue mobilized through this will form the social security seed fund.
In the case of liquor, the government proposed to levy a Social Security Cess at the rate of Rs. 20 for each bottle of IMFL having MRP between Rs. 500 to Rs. 999. In the case of IMFL having MRP above Rs 1000, the cess will be Rs 40 per bottle. An additional revenue of Rs. 400 Cr is expected through this.
In the case of fuel, the cess is expected to bring in additional revenue of Rs. 750 Cr to the Social Security Seed Fund.
The government has also brought in revision of the annual basic land tax, the revision of stamp duty rates from 5 percent to 7 percent and others for revenue generation.
‘Union Govt cost Kerala Rs 10,000 crore’
Earlier in his budget speech, Balagopal said that as a result of the policy of the Union Government treating Public Account as debt liability, there is a revenue loss of around ₹10,000 crore per annum for the state. He also added that a shortfall of around ₹7000 crore during current fiscal is there as a result of the cessation of GST compensation.
“During the tenure of the 10th Finance Commission, the share of Kerala was 3.875% of the divisible pool to be distributed among the states. By the time of the 15th Finance Commission, it came down to 1.925%. Through this, the Union Government cut down the revenue of Kerala by tens of thousands of crores. There is a shortfall of around ₹6700 crore due to the reduction of the Revenue Deficit Grant by the Union Government,” reads an excerpt from the budget speech.
The finance minister then warned that it is anticipated that the fiscal constraints in 2023-2024 will be more than that of the current year. According to him, it is because of the anticipated shortage of ₹8400 crore in Revenue Deficit Grant compared to 2022-23, the loss of around ₹5700 crore due to the cessation of GST compensation and others.
To address brain drain
The state budget has also taken efforts to address the brain drain from the state. It assured that an environment should be created so that the maximum number of youths, made capable through huge investments by the Government will be retained in the state; and employment opportunities generated for them.
“Unlike many foreign countries with extreme winter and summer, Kerala has a balanced climate throughout the year. Malayalees will choose to remain here themselves, if better job opportunities and facilities for living are provided. Measures need to be accelerated to retain the young generation in Kerala and to provide them suitable modern employment opportunities and to set up infrastructure facilities,” reads an excerpt from the budget.
Make in Kerala
The budget has also made the announcement of make in Kerala as it was found that the state imported products worth around ₹1,28,000 crore in 2021-2022. Out of this 92% was from other states. During this period, the state’s exports were around ₹74,000 crore. Out of this 70% was to other states.
It also added that analyzing productivity, expenditure towards wages and profit, measures are being taken to identify products that are possible to be produced in Kerala and to support them.
To make it workable an amount of ₹100 crore is earmarked for ‘Make in Kerala’ this year.
Other major announcements
– Rs 600 crore for supporting rubber farmers
– Rs 5000 crore for land acquisition of Vizhinjam industrial corridor
– Rs 220 crore for setting up Green Hydrogen Hubs in Kochi and Thiruvananthapuram over the next two years
– Rs 10 crore for teacher-student exchange programmes between universities in Kerala and international
universities
– A permanent venue for trade fair at Thiruvananthapuram, initial amount of Rs 15 crore allocated for this
– For work near home and work from holiday home schemes an amount of Rs 60 crores allotted
– A corpus fund of ₹15 crore will be created initially to rationalize the cost of chartered flights and thereby
keep ticket prices within the affordable range.
– Rs 50 crore for ‘Nerkazhcha’ scheme which is a comprehensive plan for eye health. It guarantees free medical advice and medicines to all visually impaired persons
– An amount of ₹50.85 crore is earmarked for various activities in areas where human-wild animal conflicts exist.
– An amount of ₹ 93.45 crore is earmarked for comprehensive vegetable cultivation development
programme
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