State budget aims to apply balm on note ban injury with sops

Plan outlay proposed at Rs 64,733 cr, revenue collection targeted at Rs 55,786.74 cr; maximum allocation for panchayat and rural development dept
Report by: 
10 Feb 2017

In the backdrop of demonetisation that severely affected the lives of the general public and against which chief minister Mamata Banerjee had remained the  most vocal critic, minister for finance Amit Mitra today placed the state's budget for 2017-18 in the state Assembly that provided for several sops for those affected by demonetisation.

The Budget was presented by Mitra as the Opposition Left Front, Congress and BJP members boycotted the proceedings protesting the alleged assault on the Leader of Opposition Abdul Mannan on February 8. While Mitra has proposed to create a fund for Rs 250 crore to provide a one-time assistance of Rs 50,000 to all those workers who have lost their jobs in other states because of the menace  and have come back to the state, it has also proposed to create a fund for Rs 100 crore for farmers who have been affected by the menace.
Another salient feature of the state budget for the coming year is that the `state government, in order to stand by businessmen who have been affected by the menace, has proposed to increase the threshold for payment of tax from  Rs 10 lakh to Rs 20 lakh. GST proposes to keep the tax threshold limit for taxation at Rs 20 lakh, he said.

The state finance minister has also proposed to abolish the provision of submission of separate audit report. Instead the dealers may submit the income audit report which will be accepted as a VAT audit report as other purposes. ``This will help more than 30,000 small businesses,'' Mitra said.
So far as composition scheme is concerned the finance minister has also proposed to bring small manufacturers whose annual turnover is less than Rs 50 lakh under the composition scheme as a result of which these manufacturers will have to pay a nominal tax. So far it was traders with less than Rs 50 lakh turnover who were under this scheme for which there was a nominal VAT liability.

Mitra in his 2017-18 estimates, targeted to collect revenue of Rs 55,786.74 crore, a 14 per cent increase over the last year's against the revised FY17 estimates of Rs 48,926.69 crore and projected the growth rate of the state's economy at 9.2 per cent. The minister, however, did not explain how the government planned to increase the tax revenue. The plan outlay for the year has been proposed at Rs 64,733 crore and the government continued all the social sector schemes for the year despite curtailment of central funds. The biggest allotment is in the sector of panchayat and rural development with Rs 12,864.64 crore while health and family welfare provided for Rs 3,299 crore.

A major announcement was in the area of stamp duty. It proposed rationalisation of stamp duty to two per cent from the existing rate of five to seven per cent.
However, Mitra said in order to get the benefit of the reduced rate, the registration has to be done within four years from the date of agreement on payment of balance stamp duty.
The budget also proposed 20 per cent reduction in the registration fee of property if done within a year of completion of construction. Mitra also reduced the stamp duty on financial papers and stock exchange transactions.
The Budget exempted from tax net eco-friendly items like bio-diesel, bio-mass briquettes, solar water heater, plates and cups made of Sal leaf, terracotta bricks, kerosene stove, hair band and hair clip.

The Budget also provided for an increase in the monthly honorarium of Rs 500 to ICDS and Asha workers of the state.
The chief Minister meanwhile later speaking to the media said she was still urging upon the centre to help the state governments reeling under a colossal debt burden  overcome the debt situation and she also appealed to the Centre to set up a debt-restructuring committee to give relief to the state. According to the budget statement of Mitra In 2016-17 the total burden for principal repayment and interest is Rs 40,000 crores and it is expected that in 2017-18 it would increase to Rs 47,000 crore.