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MP budget with Rs 559.91 cr deficit presented
Bhopal, Feb 24: A Rs 559.91 crore deficit budget (2003-04) that proposes to generate Rs 170 crore additional resources through taxes was presented today by Madhya Pradesh Finance Minister Ajay Narayan Mushran in the assembly.
Bhopal, Feb 24: A Rs 559.91 crore deficit budget (2003-04) that proposes to generate Rs 170 crore additional resources through taxes was presented today by Madhya Pradesh Finance Minister Ajay Narayan Mushran in the assembly.
Mushran said revenue receipts during 2003-04 were expected to be Rs 15,863.50 crore which would be Rs 1,685.34 crore more than the revised estimated revenue receipts in 2002-03.
A provision of Rs 12,400.40 crore had been made for non-plan expenditure during 2003-04. That is Rs 892.02 crore more than the money available under this head for revised estimates in 2002-03.
Mushran said the financial year 2003-04 was expected to end with a deficit of Rs 115.25 crore, but because of the deficit of Rs 444.66 crore of 2002-03, the next financial year would end with a total deficit of Rs 559.91 crore. He said his tax proposals were expected to generate additional resources of Rs 170 crore and that the remaining deficit would be covered by austerity in expenditure and curbing non-plan expediture.
As per a Supreme Court decision, commercial taxes would be imposed on telephones to yield a sum of Rs 40 crore each year.
He said with the introduction of the Value Added Tax system this year from April 1, tax rates on many items would be lowered. Following the introduction of VAT, commercial tax rates of tele-printers and wireless would come down from 13.8 per cent to four cent, Mushran said.
Similarly, the commercial tax on materials used in construction of houses would be reduced to four per cent from 9.2 per cent, bringing down the construction costs, he said.
He said it has been decided that with the introduction of VAT, the surcharge on commercial tax would be abolished.
The finance minister said that as per financial experts, the introduction of VAT would lead to a widening of the tax base and an increase in tax receipts.
Mushran, however, said that till the VAT system became streamlined, it was possible that the government might have to face some losses.
The Centre had assured that in the first year of introduction of vat, it would compensate 100 per cent of the losses, in the second year 75 per cent and in the third year 5 per cent, he noted. The finance minister said that the Centre had also agreed that taxes collected on some special services could be kept with the state governments and added that legal action for this would be taken by the Centre.
Bureau Report
A provision of Rs 12,400.40 crore had been made for non-plan expenditure during 2003-04. That is Rs 892.02 crore more than the money available under this head for revised estimates in 2002-03.
Mushran said the financial year 2003-04 was expected to end with a deficit of Rs 115.25 crore, but because of the deficit of Rs 444.66 crore of 2002-03, the next financial year would end with a total deficit of Rs 559.91 crore. He said his tax proposals were expected to generate additional resources of Rs 170 crore and that the remaining deficit would be covered by austerity in expenditure and curbing non-plan expediture.
As per a Supreme Court decision, commercial taxes would be imposed on telephones to yield a sum of Rs 40 crore each year.
He said with the introduction of the Value Added Tax system this year from April 1, tax rates on many items would be lowered. Following the introduction of VAT, commercial tax rates of tele-printers and wireless would come down from 13.8 per cent to four cent, Mushran said.
Similarly, the commercial tax on materials used in construction of houses would be reduced to four per cent from 9.2 per cent, bringing down the construction costs, he said.
He said it has been decided that with the introduction of VAT, the surcharge on commercial tax would be abolished.
The finance minister said that as per financial experts, the introduction of VAT would lead to a widening of the tax base and an increase in tax receipts.
Mushran, however, said that till the VAT system became streamlined, it was possible that the government might have to face some losses.
The Centre had assured that in the first year of introduction of vat, it would compensate 100 per cent of the losses, in the second year 75 per cent and in the third year 5 per cent, he noted. The finance minister said that the Centre had also agreed that taxes collected on some special services could be kept with the state governments and added that legal action for this would be taken by the Centre.
Bureau Report