The Tamil Nadu government on Thursday presented a tax-free budget for year 2016-17, though it was hit hard by a significant drop in collection of commercial taxes.
The Tamil Nadu government on Thursday presented a tax-free budget for year 2016-17, though it was hit hard by a significant drop in collection of commercial taxes. State finance minister O Panneerselvam, who presented the budget on Thursday, said there was a shortfall in revenue realisation, but attributed it to lowering of petrol prices and closure of many liquor shops throughout the state.
As a result, the Tamil Nadu government has revised its projected revenue deficit to Rs 15,854 crore for the current financial year as against the estimated revenue deficit of Rs 9,154.78 crore made during the interim budget presented in February this year.
The state has to go for additional resource mobilisation or resort to control in expenditure in order to limit fiscal deficit while managing additional expenditure commitments during 2017-2018, the minister said.
Commercial taxes, an important source of the state’s own tax revenue, have registered a negative growth during the last fiscal. Considering this, the estimates for commercial taxes have been revised to Rs 67,629.45 crore in the revised budget estimates for 2016-2017 as against the interim budget estimate of Rs 72,326.45 crore, Panneerselvam said.
Some of the important measures include providing the Greater Chennai Corporation a sum of Rs 800 crore to upgrade infrastructure. School education got the biggest slice of the pie with an allocation of Rs 24,130 crore which includes Rs 2,705 crore for distribution of 5.5 lakh laptops to students, along with books, uniforms and cycles. The energy sector received an allocation of 13,800 crore.The government also plans to purchase 2,000 new buses at a cost of Rs 150 crore. The minister allocated R150 crore exclusively to upgrade accident-prone roads. The state government has allocated Rs 400 crore as its share for the smart cities being proposed in Tamil Nadu. Similarly, Rs 500 crore has been allocated for the Atal Urban Renewal Mission.
The revised budget estimates the total revenue for the state to be Rs 1.48 lakh crore, down by Rs 3,829.14 crore compared to the interim budget presented in February this year. The government estimates Rs 1.67 lakh crore to be the expenditure in the current year.