Economy

Budget intent is enforcement and collection: KPMG

VINSON KURIAN Thiruvananthapuram | Updated on March 12, 2018

(from left) Balakrishnan Pulapre, Director, CDS; Anuradha Balaram, chief economic advisor, State Planning Board; V. K. Mathews, Chairman, CII Kerala State Council; G.Vijaya Raghavan, Member, State Planning Board and member secretary, ASB; C. Balagopal, Managing Director, Terumo Penpol; Sachin Menon, Partner, Ajay Rotti, Director, KPMG in India, at the panel discussion held as part of the Budget analysis in Thiruvananthapuram.

The overriding theme of Union Budget 2013-14 is enforcement and collection, according to KPMG in India.

Speakers at a Budget analysis event hosted by KPMG in India opined that the document bares the Finance Minister’s aggressive intent.

AGGRESSIVE INTENT

The event was co-hosted by the Asian School of Business and the Kerala State Council of Confederation of Indian Industry.

Sachin Menon, Partner and National Leader, Indirect Practice, KPMG in India, recalled the unflattering fiscal backdrop to the Union Budget.

But the Finance Minister does not seem to have gone the distance in forcing the issue despite the early aggression.

“As in fixing at Rs 50 lakh the threshold limit for failure to collect or pay that could invite punitary action,” Menon said.

This has been made non-bailable and the offender could be slapped with seven years of imprisonment.

If passed in Parliament in the present format, a commissioner can authorise a superintendent to effect arrest.

This can create a lot of avoidable problems, least of which is the contentious status of a junior officer who executes the arrest.

NOT BACKED UP

Apart from this, there is hardly anything affirmative in the Budget that guarantees a smooth ride in 2013-14 either, Menon said.

Buoyant tax collections of incremental 19 per cent with a targeted 6.1 to 6.7 per cent of GDP growth do not inspire confidence, he said.

“Where are the revenues coming from” he wondered. “Unless he targets you and me,” he added.

If the Finance Minister is vouching by non-tax revenue collections, he is more than likely to be disappointed.

This is because disinvestment revenues of Rs 50,000 crore with as much as Rs 40,000 crore from telecom are a tall order given the state of the industry.

Neither has Reserve Bank shown the inclination to toe his line of making available cheaper capital, at least not just yet.

“All in all, the Finance Minister will be required to do tight-rope walking into the next financial year as well,” Menon said.

>vinson.kurian@thehindu.co.in

Published on March 05, 2013

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