Financial policies pursued by the Union government are pushing the State into a serious financial crisis, Minister for Finance K.N. Balagopal has said.
Replying to questions during the Question Hour in the Assembly on Wednesday, Mr. Balagopal said the main source of the State’s revenue receipts were the Central tax share and grant-in aid for Centrally-sponsored schemes. The share received by the State had seen a drop in the past few years.
The one-time Central assistance, additional Central assistance and normal financial assistance that were available during the time of the Planning Commission had been stopped.
With the introduction of the Goods and Services Tax (GST), there have been limits and restrictions on interventions to increase revenue. The States had powers to tax only a few items such as petroleum products and liquor.
The Minister said the State’s own tax receipts were expected to increase by 12.7% during the 14th Five-Year Plan period.
To increase tax collection, the government had reorganised the GST department and formed wings such as tax payer services and audit and intelligence enforcement, adopted steps to correct anomalies in land fair price and implemented a 10% one-time hike in the current fair price, besides introducing amnesty schemes to collect tax arrears and so on.
