Business Daily from THE HINDU group of publications
Thursday, Aug 24, 2006
Industry & Economy
States - Kerala
Kerala faces revenue shortfall
Facts and figures
Arrears to the contractors were to the tune of Rs 1,300 crore.
Welfare pension arrears had mounted to around Rs 750 crore.
The Government was to receive tax arrears of about Rs 3,000 crore.
Thiruvananthapuram , Aug. 23
Going by the current trend, the Kerala Government will face a shortfall in revenue receipts from what has been projected in the State budget for the current year.
According to the Finance Minister, Mr Thomas Isaac, revenue receipts will fall short by around Rs 1,000 crore, even as expenditure has been going up as compared to budget estimates.
The Minister told newspersons here on Wednesday that arrears to the contractors were to the tune of Rs 1,300 crore. Out of this, Rs 300 crore had to be settled in the next few weeks. Besides, welfare pension arrears had mounted to around Rs 750 crore.
Against this background, all the departments were directed to submit proposals for increasing revenue and these would be compiled and placed before the next Cabinet meeting, Mr Isaac said.
The Government would seek ways for additional resource mobilisation and also increase tax collection in the coming months to tide over the situation, he said. He noted that the Government was to receive tax arrears of about Rs 3,000 crore. The public sector undertakings accounted for about half this amount and could not be realised immediately.
Pointing out that the fiscal policies of the Centre had impacted the State adversely, he said that its contribution to small savings was expected to fall short by Rs 1,250 crore. This was primarily because the Centre had withdrawn certain concessions in this respect.
The Minister said the Government would launch a campaign against the Centre's stringent directions to the state governments under the Fiscal Management (Responsibility) Act.
If the State Government had to bring down the fiscal deficit to four per cent as directed as against the present 6.4 per cent, it would be at the expense of the developmental activities.
It was not fair on the part of the Centre to block assistance to the State Government merely on the ground that it could not meet the target, he added.
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