KL Report
Jammu
Maintaining that Jammu and Kashmir is moving forward in right direction to minimize the fiscal deficit as per the guidelines and principles laid down in the J&K Fiscal Responsibility and Budget Management (FRBM) Act, the Minister for Finance, Abdul Rahim Rather today said that the Comptroller and Auditor General (CAG) too has appreciated the state’s financial achievements especially in the field of internal resources mobilization, adding that the tax revenue has touched an all-time high figure of Rs 5900 crore.
The growth rate works out to about 26 per cent over the last year’s collection of Rs 4745 crore, he added. He said the state has also been applauded by the Empowered Committee of State Finance Ministers and the Finance Commission (FC), the highest monitoring foras of the country, for effective implementation of VAT regime and has been tagged as one of the best tax collection States of the country.
While quoting CAG’s Draft Report on State Finances for the year ending March 2012, Rather said that the state has been appreciated for its financial achievements. He said that the state has made good use of the opportunities presented by the increased economic activities to substantially increase tax revenues. There has been a record mobilization of commercial taxes and stamp duties in 2011-12, and the state’s own revenues have shown a very high growth. It is to the credit of the government that the state’s dependence on non-debt resources from the Central government (as %age of total expenditure) has come down from 67% in 2006-07 to 63% in 2011-12. CAG has said that even as concerns remained about delay in completion of on-going projects, the state government’s capital expenditure has registered significant and steady increase.
Likewise, it has been appreciated that the state’s switchover to government banking with RBI with effect from April 2011 after liquidating its entire overdraft with J&K Bank as on March 2011 with Special Central Assistance in the form of Grant-in-aid of Rs 1000 Crore. During 2011-12, the interest burden on overdraft/ways and means advances came down by over Rs 220 crore as a result of this switchover to new banking arrangement. CAG has also patted the state for taking significant decisions like introduction of National Pension Scheme (NPS), bringing more items under the ambit of VAT, some services under tax net, computerization of Commercial Taxes Department and a host of other institutional and sectorial reform measures. The arrears in the accounts of PSU’s are also being liquidated, the CAG report adds”.
In his one hour and forty five minutes long reply to the debate on the budget 2013-14, in the J&K Legislative Council today, Rather said that the economic growth is also showing an upward trend satisfactorily within 13th Finance Commission targets.
As many as 19 members took part in 3 days debate which took about five hours and twenty minutes to conclude and expressed their views about the budget proposals and projections.
Rather said that the landmark achievements have been possible due to close monitoring and intensive review meetings coupled with efficient budget management and fiscal discipline to gauge the growth trends after intervals.
The Minister said that the tabling of annual report of the FRBM Act, which oversees the limits and targets for reducing fiscal deficit with prescribed targets, in the state legislature has become a regular feature since 2009. He said tabling of the report is mandatory to get central grants and funding for state plans. He said state’s fiscal deficit is also declining as per the prescribed targets, adding that the per capita Income is also increasing satisfactorily.
Rahim said that the tax revenue of the state has increased to Rs 5419 crore during current fiscal, showing increase of Rs 556 crore, which works to be 26% over the last year’s collection of Rs. 4745 crore,. He said the VAT collected by Commercial Taxes Department is likely to reach to 4219 crore in comparison to 3940 crore , exceeding the budgetary target by Rs. 279 crore. It is targeted to increase to Rs 4800 crore in the next fiscal. He said the excise revenue has also steadily increased to Rs 875 crore in the current financial year against Rs 517 crore in 2008-09. He announced that full computerization of the Commercial Taxes (CT) department will be rolled out from the April next, adding that it will be the first department in the state to be 100 percent computerized. “Computerization of the department will be a big relief for the trading community as it will provide online transaction, e-payment, e-registration and e-return facilities to the traders and will also minimize their direct interface with the departmental personnel. He said both commercial taxes and excise departments will be reorganized to fill the gaps in human resource, which he said, was imperative to further improve the efficiency of these vital revenue collection departments. He said the new Toll Plaza, at Lakhanpur, spread over an area of 133 kanals, which is the gateway to J&K, has been completed at a whooping sum of Rs 42.50 crore.
“It has now a spacious truck yard to accommodate about 250 trucks at a time and 9 computerized weigh bridges”, Rather said adding that more 109 kanals of land are being acquired to meet the future requirements. The completion of this important project is vital for the growth and development of the state as it will facilitate better resource mobilization and check tax evasion, he added.
Rather dispelled apprehension expressed by some members that the agriculture growth was declining adding that it was a national as well international phenomenon that the contribution of agriculture in the overall economy is declining but its growth increases correspondingly. He said Chief Minister, Omar Abdullah was keen to make the State agriculture sector totally tax free.
He said tax concessions on the import of day old chicks have reduced import of poultry birds, thereby considerably giving fillip to the local poultry production.
The Finance Minister also gave a comprehensive account of the power scenario in the state and said under the new hydel policy, the state will be able to generate about 9000 MW. He said power deficit is a grey area of the state’s overall economic scenario, adding that against an expenditure of Rs 3874 crore on import of energy, the revenue generation on this account was only Rs 2450 crore during this fiscal. He also gave a detailed account of various hydel power projects in offing and said that the T&D losses are also showing downward trend. He also informed the House about measures taken to overcome un-employment problem and assured the members that qualification bar for assistance of Rs 30,000 as government contribution for marriage of grown up BPL girls could be reviewed in future as the initiative is just to start in as a good will gesture.
Rather said that some corporations owe an estimated total sum of Rs.95 crore to their serving and retired employees by way of CPF contribution and gratuity etc. The Government in a major initiative has decided to clear off these pending statuary liabilities in two years’ time frame adding that a sum of Rs. 50 crore has been kept in the next years’ budget as special budgetary support to the financially weak corporations, over and above the normal budgetary support of Rs. 59 crore. He said that once a prestigious lending organization, the State Financial Corporation which had lost its capital base has been brought back on rails and it will start earning profit from the next year besides extending loan facilities.
