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Kerala Finance Minister KM Mani combined poll-driven tokenism with flashes of fiscal realism to present a deficit budget for 2014-15 here on Friday.
Farm-friendly and welfare-oriented to start with, the Finance Minister went for jugular midway through as he jacked up taxes on motor vehicles, land and property.
RESOURCE MOBILISATIONHe aims to collect Rs 1556.35 crore in additional resources and concedes only Rs 125.55 crore in exemptions. But the target of achieving zero revenue deficit as required by the Kerala Fiscal Responsibility Act has gone for a toss and by a wide margin.
The budget will leave a revenue deficit of 1.53 per cent and a fiscal deficit of 3.10 per cent. Deficit for 2014-15 clocks in at Rs 168.92 crore.
INCOME GUARANTEEIts major highlight is a crop insurance scheme in which the government pays up 90 per cent of the premium. The aim is to bring about an ‘income guarantee scheme’ in which the farmer is assured of a fair return on his produce.
The scheme will be available for small and marginal farmers holding no more than two hectares of agricultural land. They need to pay up only 10 per cent of the premium.
The government will tie up with major insurance companies to bring at least 25 crops under coverage.
A health insurance scheme will also be designed for these small and marginal farmers in which the government bears 50 per cent of the premium expense.
WELFARE PENSIONSWelfare pensions paid out to a range of beneficiaries have been revised upwards by Rs 100 to 200.
Fair price for land will be fixed afresh. Stamp duty has been rationalised at a uniform six per cent across local body categories. Building tax has been doubled.
The Finance Minister literally tore through the motor vehicle taxation regime re-fixing rates, juggling slabs, or taxing fresh.
He spared none – motor cycle, private car, taxi cab, autorickshaw, contract carriage, or luxury car – and targeted each depending on carrying capacities.
Heavily taxed (105 per cent) liquor will be costlier by another 10 per cent.
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