M A I N   N E W S

Fresh HP taxes to net Rs 24 cr
Panchayati Raj bodies to get more powers
Tribune News Service

SHIMLA, March 9 — The Chief Minister, Mr Prem Kumar Dhumal, has proposed fresh taxes to net a revenue of Rs 24 crore in the Rs 1167 crore deficit budget for the financial year 2000-2001 which he presented in the Vidhan Sabha today.

He also announced a relief of about Rs 4 crore in the existing taxes.

The prices of petrol, diesel and aviation fuel will increase as the sales tax on petrol and aviation turbine fuel is proposed to be doubled from the existing 10 per cent to 20 per cent and that on diesel would be increased to 12 per cent from the existing 8 per cent.

Mr Dhumal has proposed to impose a sales tax of 4 per cent on poultry and cattle feed, branded bread, fertilisers, pesticides, raw wool, insecticides, agricultural implements and refractory bricks. An 8 per cent sales tax will be imposed on crudely tanned leather.

The Budget proposals seek enhancement of the 4 per cent sales tax on agarbatti, tractor attachements and earth-moving machinery to 8 per cent.

Tractors will become dearer as the sales tax on these is proposed to be increased to 8 per cent from the existing 1.5 per cent.

The sales tax on oil cake (cattle feed) will be increased to 4 per cent from the existing 1 per cent.

Mr Dhumal proposed to increase the sales tax to 12 per cent from the existing 8 per cent on weather-proofing compounds, preserved food articles, musical instruments, hair oils, air circulators, adhesives, clocks, PVC articles, fireworks, lift and elevators, marble, paints and colours, sandal wood and oil, transformers, transmission wires, towers, voltage stabilisers, synthetic gems, ivory products, nathpa, asphaltic roofings, cables, oxygen and gas, ASCR conductors and soaps.

IMFL and country liquor will also become dearer as a sales tax of 20 per cent is proposed to be levied on these. The sales tax on narcotics, molasses and rectified spirits is proposed to be increased to 12 per cent from the existing 8 per cent.

As a relief to the employees, the Chief Minister announced the release of the pending instalment of 5 per cent additional dearness allowance with effect from July 1, 1999. He said that despite the financial constraints, the government had decided to release the instalment of ADA. The arrears up to March 31, will be credited in the provident fund.

Mr Dhumal announced to reduce sales tax by half on grocery, raw silk, solvent oils, dry fruits, quilts, cycles, renewable energy devices, hosiery, starch and few other commodities. The revised sales tax will be 4 per cent against the existing 8 per cent on these items. The sales tax on tiles, filters, blades, wooden furniture, foam products and sanitaryware is proposed to be reduced to 8 per cent from the existing 12 per cent.

The sales tax on motor spare parts is proposed to be slashed to 4 per cent from the existing 12 per cent. Sales tax on tyres and tubes is proposed to be reduced to 8 per cent from the existing 10 per cent.RAMMURTI/....FRESH-2

Mr Dhumal, who also holds the finance portfolio, also proposed to cut the sales tax on gold and silver and its ornaments to 2 per cent from the existing 4 per cent.

The Rs 4965.95 crore Budget indicates an income of Rs 4065.39 crores during the year resulting in an anticipated deficit of Rs 900.56 crore. The cumulative deficit with the current year’s deficit is expected to be Rs 1167.87 crore.

To reduce expenditure in the public sector undertakings, the Chief Minister said a voluntary retirement and golden handshake schemes would be introduced. The housing board and the Nagar Vikas Pradhikaran are proposed to be merged. The four separate corporations engaged in social welfare related activities will be merged into two and the minorities, women and OBC corporations will become one.

Mr Dhumal said in certain areas autonomous bodies would be created to perform government functions with a view to increasing accountability. However, in doing so, the interests of the employees would be fully safeguarded. Among the areas mentioned in this regard were viable farms of the agriculture, horticulture, veterinary and fisheries departments, medical colleges and ayurvedic colleges, hospitals attached to the medical colleges, mountaineering institute, ayurvedic pharmacies, HIPA, wild life and eco-tourism and maintenance of industrial areas.

He also announced some other rationalisation measures on the tax front. These include raising the exemption limit of issue of cash memo for purchases from Rs 25 to Rs 200, a provision for deduction of sales tax at source in case of government purchases, a provision for composition of tax payable by contractors and stone crushers, the abolition of the motor spirits (Sales and Tax) Act 1968 and bringing these items within the purview of the General Sales Tax, the abolition of HP Entertainment Tax (Cinematograph shows) Act 1968 and HP Entertainment duty rules 1968, the raising of minimum limit of sales tax registration for hotels, restaurants bakeries etc. from Rs 1 lakh to Rs 2 lakh, rationalisation of luxury tax to provide for levy on actual tariff charged by hotels instead of registered tariff, and simplification and rationalisation of the Stamp Duty Act to make it suitable to the present economic environment.

He said to remove inspector raj in the tax domain, it was proposed to start a new scheme of sales tax self assessment to be called “vishwas 2000”. This scheme will be available to dealers who have a turnover of up to Rs 50 lakh annually provided they showed a turnover increase of 10 per cent over the previous year.

While mentioning the position with regard to the overall Budget estimates, Mr Dhumal said the revised estimates of the current year showed that the estimated year-end deficit of 1999-2000 would be Rs 267.31 crore against the originally projected Rs 1511.05 crore.

With regard to the year 2000-01, the revenue deficit is expected to be Rs 1299.39 crore, as resulting from revenue expenditure of Rs 4057.11 crore and revenue receipts of Rs 2757.72 crore. Net capital expenditure is estimated at Rs 666.11 crore and after taking account of GPF and other accretions, the deficit estimated in the course of the year is Rs 900.55 crore.

However, this is expected to reduce since the central transfers on account of finance commission devolution has been kept at the same levels in 2000-01 whereas higher devolution will be available under the 11th Finance Commission recommendations provided for in the Union Budget. The non-Plan expenditure has been projected to grow in 2000-01 at the rate of 9.4 per cent over the RES of 1999-2000. This has been possible due to the rationalisation of non-Plan schemes attempted in the Budget which had seen the reduction of 215 non-Plan schemes in this Budget.

Mr Dhumal outlined a nine-point charter on the basis of which each department will be required to draw up action plans. The nine points include simplification of procedures and examination of both laws and administrative procedures for this purpose, rationalisation of schemes, reduction of untargeted subsidies and targeting of schemes for genuinely needy persons, decentralisation, PSU reforms, associating private sector in governance, identifying areas for performance of functions through autonomous bodies, evolution of policy for the private sector investment and the creation of outcome-related parameters for monitoring the performance of the government.

Mr Dhumal laid special emphasis on steps to promote decentralisation of government. He outlined a series of initiatives to increase the role of local bodies in government. Prominent among these is the recruitment of employees for local-level institutions, including primary schools would be handed over to panchayats, handing over of water supply schemes to urban local bodies, empowering the local bodies to raise loans from NABARD and other institutions, handing over selection of beneficiaries and distribution of benefits under the old age pension and housing subsidy schemes to panchayats.

An important announcement made by the Chief Minister was that the government proposed to make the areas of all non-Tribal Assembly constituencies and development blocks co-terminus. Keeping in view this, it is proposed to open new blocks in the Kot Kehloor, Doon, Santokhgarh, Bamsan, Machan, Balh, Sulah, Dharamsala and Jaswan constituencies.

To give greater fillip to decentralisation, the state cadres of nurses, pharmacists in different departments, male and female health workers, laboratory technicians and village extension officers of the Agriculture and Horticulture Departments, clerks, ICDs supervisors and Village Development and Panchayat Officers would be converted into district cadres.

In the industries sector, Mr Dhumal stated that the state has 178 large and medium industries and 2800 small industries, with an estimated investment of Rs 2650 crore, giving employment to 1.44 lakh persons and producing goods worth Rs 4200 crore. For the year 2000-2001, the target includes setting up of 600 new small industrial units and 2400 artisan units. Apart from this, a comprehensive scheme for giving a fillip to sericulture is being evolved to benefit 10,000 families in the coming years. To give appropriate direction to the state’s efforts in the area of information technology, Mr Dhumal mentioned that Nasscom had been appointed as a consultant to help in framing an information technology policy.

On the tourism front, he outlined a number of new initiatives, including the establishment of destination funds to be contributed by the hotels, travel and tour agencies located in the state. The establishment of a new tourism promotion board and special schemes for provision of amenities at five centres of religious tourism in the state. He also announced that in order to give a fillip to tourism, 50 per cent of the hours for which the state had leased a helicopter would be designated for tourism associated commercial usage.

In primary education the Plan outlay had increased from Rs 34 crore in 1997-98 to Rs 121.58 crore in the coming year. This substantial increase includes Rs 43.91 crore for the construction of school rooms under the Sarswati Bal Vidya Sankalap Yojana. In addition to 2100 Vidya Upasaks announced last year, the Chief Minister said the government would allow 1000 Vidya Upasaks to be appointed in the coming year through the panchayats.

In the area of water supply, the targets proposed for the coming year were 650 hamlets to be provided water supply schemes and the installation of 650 handpumps in the rural areas at a cost of Rs 72.32 crore and providing Rs 21.27 crore for the urban water supply schemes. In addition Rs 27.54 crore have been kept for sewerage schemes in urban areas.

Mr Dhumal laid special emphasis on the development of backward and weaker sections and stated that an outlay of Rs 40.68 crore had been kept for this purpose.

To give due regard to the other backward castes in the state, Mr Dhumal announced that Agriculture University at Palampur would be re-named as Chaudhary Sarwan Kumar Vishvavidyalaya.

Mr Dhumal announced 10 new schemes in the area of educational scholarships and the development of the weaker sections. These include free education for disabled children up to the university level, the Maharishi Valmiki Chhatarvriti Yojana to give scholarship of Rs 9000 to each girl from the identified scavenger families desirous of pursuing university or professional education after completion of schooling, a special prize of Rs 1 lakh to the panchayat standing first in each assembly constituency with respect to birth rate, infant mortality rate and immunisation, Chief Minister’s incentive prize of Rs 5 lakh to nine panchayats of the state contributing the maximum students under the Ambedkar Medhavi Chhatravriti Yojana (and other similar schemes for general categories and Scheduled Tribes), special prize of Rs 25,000 to the best performing self-help group under the Gram Swaran Jayanti Yojana in each constituency, Guru Ravi Dass Civic Amenities Improvement Scheme to give Rs 3 lakh to one Scheduled Caste majority ward in every assembly constituency, a special incentive of an additional Rs 2 lakh to every such legislator who allocates his or her entire annual MLA fund for schemes only in the education and health sectors and a special insurance scheme for women below the poverty line to provide cover against accidental death of such women or their spouses in which the entire premium would be paid by the state government.

Mr Dhumal announced introduction of the T.S. Negi Scholarship Scheme under which an annual grant of Rs 11,000 to 100 boys and 100 girls of the Scheduled Tribes for pursuing education at the plus 2 level will be given and also Swami Vivekanand Chhatravariti Yojana to provide annual scholarship of Rs 10,000 each at the 10 plus 2 level for 2000 general category students.