M A I N   N E W S

No new taxes in Haryana Budget
Gimmickry, says Bhajan Lal
Tribune News Service

Chandigarh, March 12
The Haryana Budget for 2001-2002 shows a deficit of Rs 54.93 crore on year’s account, with the next financial year to close with a cumulative deficit of Rs 288.79 crore, which the Finance Minister, Prof. Sampat Singh, hopes to cover by adopting economy measures, increased share of the state in Central taxes and buoyancy in the state’s economy.

Presenting the Budget, termed as the second successive “tax-free” Budget by the government, in the Vidhan Sabha here, Prof Sampat Singh announced his intention to establish two new funds, “a sinking fund” would be created to meet a sudden debt-servicing contingency. He said the total borrowings of the state government would stand at Rs 14,039 crore at the end of the current financial year. The total debt of the public sector enterprises (PSEs), which stood at Rs 2,841.31 crore on March 31, 2000, had been guaranteed by the state government.

He said these loans were in effect liabilities the state government might be called upon to discharge. “Unless provided for, a sudden debt-servicing contingency in a given year can disrupt our development investment plans significantly”. The “sinking fund”, contributions to which would come in the form of Budget allocations and guarantee fees from the PSEs, would meet such an eventuality.

Another fund, “the state economic renewal fund”, to be set up through annual budgetary allocations, assistance from the Central Government and contributions from the PSEs, would be used for the rationalisation of government departments and agencies.

The Finance Minister, who took 55 minutes to read out his Budget speech, said 2000-2001 opened with a deficit of Rs 165.51 crore and was likely to close with a deficit of Rs 233.86 crore. The deficit was likely to cross Rs 288 crore by the end of 2001-2002. He provided for a state plan outlay of Rs 2,150 crore in addition to the expected outlay of Rs 415 crore in Centrally-sponsored schemes. The state plan he proposed to fund by the state’s own resources to the tune of Rs 1581.70 crore(73.6 per cent) and by Central assistance of Rs 568.30 crore(26.4 per cent).

Prof Sampat Singh said the estimated revenue receipts in 2001-02 were likely to increase by Rs 923.35 crore from the revised estimates of Rs 7,035.91 crore in 2000-01 to Rs 7,959.26 crore. The estimated revenue expenditure for 2001-02 was also likely to be higher by Rs 928.37 crore from the revised Rs 8,069.09 crore in 2000-01 to Rs 8,997.46 crore. The growth in expenditure, he said, would be mainly due to an increase of Rs 466.78 crore in salaries, Rs 259.56 crore in interest payments and Rs 156.22 crore in power subsidy.

He said while projecting receipts and expenditure for 2001-02, he had followed the guidelines of the Planning Commission and had assumed the state’s share in the Central taxes as per the indication of the commission.

Prof Sampat Singh described the Budget as a balanced one, growth-oriented, embracing all sectors of the economy with special focus on measures to give a boost to new investment in infrastructure, industries and agriculture. He said his second Budget was more balanced and more realistic as compared to the one presented by him last year.

He said the deficit on year’s account had been reduced by Rs 29.44 crore and the level of borrowings had come down by Rs 82.20 crore. There was an improvement in the tax-GSDP ratio from 7.46 per cent in 1999-2000 to 8.38 per cent during the current year. “While the growth in the total revenue receipts during next year is expected to be 13.12 per cent, the corresponding growth in revenue expenditure is likely to be arrested at 11.5 per cent, which is an indication of our efforts in fiscal corrections.”

Expressing satisfaction over the “correct directions in which the state’s economy is growing”, Prof Sampat Singh said the contribution to GSDP from the primary sector(35.4 per cent) was on the decline and there was a happy trend of expansion of the secondary and tertiary sectors of the state’s economy. Contribution from the secondary sector had increased from 24.7 per cent in 1993-94 to 27.2 per cent in 1999-2000 and that from the tertiary sector from 32 per cent to 37.4 per cent during the same period.

He said efforts in rationalisation and simplification of the state tax system, expansion of the scope of self-assessment and the introduction of various other trader-friendly measures had increased the sales tax receipts by 33.4 per cent up to December, 2000. He, however, did not agree that the increase was mainly because of the introduction of unform sales tax rates in the region. The estimated increase in the state taxes for the next financial year was projected at 15.3 per cent, a decline of over 50 per cent over last year’s increase.

The outlays for various sectors announced by Prof Sampat Singh were: power Rs 1287.11 crore; irrigation Rs 773.47 crore; roads and bridges Rs 511.83 crore; public transport Rs 510.83 crore; public health Rs 481.24 crore; agriculture and allied activites Rs 539.91 crore; Cooperation Department Rs 29.72 crore; industries Rs 33 crore; education Rs 1532.43 crore; social welfare Rs 473.44 crore and Health Rs 371.88 crore.

The Leader of the Opposition, Mr Bhajan Lal, said the government had played a trick on the people by presenting a so-called tax-free Budget. Last year also the government had indulged in similar gimmickry but had later burdened the people with heavy taxes.

Later, while talking to newsmen, Prof Sampat Singh refused to give an assurance that the government would not impose any taxes in the coming financial year after presenting a “tax-free” Budget, saying that there could be unforeseen eventualities.