O.Panneersevam presents revenue surplus budget

CHENNAI: Proposing fresh tax measures to mobilize additional revenue of Rs 1,500 crore while maintaining focus on fi scal prudence, Finance Minister O Panneerselvam today presented a Rs 2,376.07 crore revenue surplus budget promising to keep fi scal defi cit within three per cent of the GSDP as mandated by the 13th fi - nance Commission. Presenting the second Budget of the AIADMK Government headed by Chief Minister J Jayalalithaa, Mr Panneerselvam said the various measures taken by the government had resulted in an improvement to the State’s fi nancial position ‘which was in shambles when this government assumed offi ce in May 2011.’ The revised budget estimates for 2011-12 showed a revenue surplus of Rs 173.87 crore. However, the government had bettered the scenario recording a revenue surplus of Rs 536.54 crore for the period. The budget estimates for 2012-13 have been designed to further improve the fi - nancial position of the State Government, he said. The fi scal defi cit is estimated at Rs 19,832.13 crore constituting 2.87 per cent of the GSDP well below the three per cent norm set by the 13th fi nance Commission. Outlining new tax measures for mobilising additional revenue of Rs 1,500 crore for implementing various welfare programmes, Mr Panneerselvam proposed hiking VAT on liquor to 14.5 per cent, withdrawing VAT exemption on vegetable oils and rationalizing taxes on tourist taxis, maxi cabs, private service vehicles, construction equipment vehicles besides doubling the charges for advance blocking of fancy numbers. Mr Panneereselvam also announced the implementation of revised guideline valuation for properties with effect from April one, 2012. Further, the Minister promised to restrict the borrowings while giving thrust to capital expenditure the allocation for which has been increased from Rs 16,388.34 crore in the revised estimates for 2011-12 to Rs 20,856.08 crore in the Budget Estimates 2012-13 representing a hike of 27 percent. On borrrowings, Mr Panneerselvam said while the borrowing entitlement for the year 2012-13 is Rs 20,716 crore, the government intends to restrict it. The outstanding public debt, including other liabilities like provident fund will be Rs 1, 35,060.47 crore as on March 31, 2013 constituting only 19.56 per cent of the GSDP. However, the various welfare measures and increased subsidy to the Tamil Nadu Electricity Board by the government is going to increase the bill on subsidies and grants. Due to this, the Finance Minister had projected a growth rate of 15 per cent for 2013-14 and 2014-15 on subsidies and grants. Adding a note of caution, Mr Panneerselvam said revenue receipts may vary due to downward trends in economic growth.. However, he was confi dent of the State maintaining revenue surplus and fi scal defi cit within three per cent of the GSDP even if there was a three percentage point fall in growth rate of revenue receipts in 2012-13, 2013-14 and 2014-15. He said the State will achieve all the targets set by the 13th Finance Commission during 2012-13 and continue its record in the successive fi nancial years also.