Financial Daily from THE HINDU group of publications
Thursday, Mar 02, 2006
Financial Daily from THE HINDU group of publications Thursday, Mar 02, 2006 |
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Opinion
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Letters Complacent Budget
The Budget appears to be rather complacent. It has not tapped into the inherent buoyancy created by a growth rate of 8.1 per cent. Compared to estimates, the revenue performance in 2005-06 is marked by lower realisation in Union excise duties (Rs 9,533 crore), corporation tax (Rs 7,000 crore), and higher realisation of Customs duty ( about Rs 11,033 crore), service tax (Rs 5,500 crore). The Finance Minister's exertions on the revenue front for 2006-07, is only Rs 6,000 crore. One consequence has been that tax devolution to the States has been lower than Budget estimates by Rs 3,600 crore in 2004-05 and Rs 500 crore in 2005-06. Grants-in-aid to the States have been lower than Budget projection in 2004-05 and 2005-06 even the provision for compensation for losses on account of VAT introduction have been lowered in 2005-06 and marked by a lower provision of Rs 3,000 crore in 2006-07. Provision of funds for right flagship schemes in education, health and urban development are welcome. Poor progress in power and other infrastructure projects has led to a continuance of tax concession for a further period upto 2009. There is need for close attention to problems of implementation. Greater attention to a proper mix of Budgetary provision and institutional change will enable accelerated progress in infrastructure projects. V. K. Srinivasan Vice Chairman, Indian Institute of Economics
Letters to the editor and contributions can be sent by e-mail to: bleditor@thehindu.co.in
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