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Tamil Nadu Budget: O Panneerselvam steers clear of new taxes, revenue deficit narrows
KV Prasad Jun 13, 2022, 06:35 AM IST (Published)
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Summary
Tamil Nadu deputy chief minister O Panneerselvam, who holds the finance portfolio, reposed hope that tax revenues in the state would continue its positive trajectory, while announcing that revenue deficit projections for FY 20 had narrowed down to Rs 14,314 crore. Revenue deficit estimate stood at Rs 17,491 for FY19, while actual deficit was pegged at Rs …
Tamil Nadu deputy chief minister O Panneerselvam, who holds the finance portfolio, reposed hope that tax revenues in the state would continue its positive trajectory, while announcing that revenue deficit projections for FY 20 had narrowed down to Rs 14,314 crore.
Revenue deficit estimate stood at Rs 17,491 for FY19, while actual deficit was pegged at Rs 19,300 crore. On the bright side though, the state displayed signs of GST-driven tax revenue picking up pace.
“Economic growth in the state is expected to further boost our tax revenues,” said Panneerselvam while presenting the state budget for 2019-20, “We had some difficulty owing to GST in 2017, but we later achieved some momentum.” The state’s fiscal deficit projection of Rs 44,176 crore for FY 20 continued to remain as bleak as that of last year’s Rs 44,481 crore for FY 19.
Being a poll year, it came as no surprise that Tamil Nadu’s budget proposed no additional taxes or levies. While there were no new big-bang populist announcements, the state government announced a decent list of poll sops.
The state finance ministry’s decision to allocate nearly Rs 85,000 crore towards salaries and pension for government employees (41 percent of its total expenditure of Rs 2.08 lakh crore for FY 20), signals the impact of 90,000 government teachers going on strike demanding better wages.
In keeping with previous year’s budgetary allocations, O Panneerselvam announced that Rs 6,000 crore would be earmarked for food subsidies, including ruling All India Anna Dravida Munnetra Kazhagam’s (AIADMK) free rice scheme.
Another familiar budgetary allocation was the Rs 1,072 crore set aside for former chief minister J Jayalalithaa’s pet free laptop distribution scheme.
The state government also announced a budgetary allocation of Rs 491 crore towards the distribution of free dhotis and sarees, in the run-up to Lok Sabha elections.
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