West Bengal Finance Minister Amit Mitra has proposed no new taxes, promised 22 lakh jobs and came up with a slew of administrative and tax reforms to aid ease of doing business while increasing Plan Expenditure to Rs 57,905 crore as he presented the budget for 2016-17.
“I propose to increase the Plan Expenditure to Rs 57,905 crore for 2016-17, ” Mitra said during his budget speech in the assembly.
In the last fiscal (2015-16), the state’s actual Plan Expenditure surpassed the estimated allocation by seven per cent. While the budget estimate was Rs 49,507 crore, the actual expenditure was Rs.53,010 crore — almost Rs.4,000 crore more.
Mitra estimated the budget deficit at Rs 8 crore in the current fiscal. He did not propose any fresh taxes notwithstanding the state being debt stressed. The minister said fiscal deficit was brought down to 2.68 per cent and revenue deficit to 1.03 percent in 2015-16.
Mitra said the state borrowed Rs.1,13,104 crore in the last five years. But out of that, Rs.94, 533 crore was drained out only for debt servicing of the debt taken by the previous government.
“We borrowed about Rs 18,571 crore for development in the last five years, that is, a yearly loan of only Rs 3,718 crore,” he said.
The minister proposed a slew of administrative and tax reforms, raising the exemption limit for professional tax from Rs 8,500 to Rs 10,000 per month to give relief to employees and wage earners, and deciding to abolish from July 1 the Settlement Commission for settling outstanding VAT/Sales Tax liabilities in view of the large disposal of old pending cases through Fast Track Courts.
In order to further bring down the litigations and cut down on administrative cost, the state would not go for litigation where the disputed amount in appeal order was less than Rs 1 lakh.
The minister also proposed to do away with manual furnishing of TDS certificate that was so long mandatory for getting such benefit under VAT law.
To provide relief to the tea industry and thereby protect the interest of tea workers, Mitra proposed exemption from payment of rural employment and education cess be further extended for one more year up to March 31, 2017.
He said the state government aimed to generate 22 lakhs employment in the current fiscal, by laying stress on micro, small and medium enterprises (MSMEs).
He proposed to create 732 e-classrooms in the colleges and universities and 2,000 in secondary and higher secondary schools in the first phase. “We allocated Rs 100 crore in the initiative,” he said.
The minister allocated Rs 200 crore for the Swami Vivekananda West Bengal Government Merit-cum-Means Scholarship Scheme with an aim to encourage meritorious students to pursue higher studies.
The business circles welcomed the budget, but the opposition political parties denounced Mitra’s claims and proposals.
Leader of Opposition Abdul Mannan demanded white paper from the state government on the state of big investments and employment.
Left Front legislature party leader Sujon Chakraborty said during the past five years the state government has taken market loan of over Rs 1.13 lakh crore, pushing the state into a debt trap.
CII West Bengal state council chairman Anil Vaswani called the budget “developmental oriented with a focus on small-scale industries, health, infrastructure and education.”
The Bengal Chamber of Commerce and Industries said the budget was “forward-looking”, while the Indian Chamber of Commerce said the budget focuses on primary sector revival and inclusive growth.
However, it termed as dampeners the absence of a clearer roadmap on matching the fiscal consolidation needs of the government with the huge intended social sector spending, and lack of a detailed blueprint of fiscal incentives for big ticket investments and ancilliarization.