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Going
by the whole text of the Finance Minister's budget speech,
it appeared that the topnotch bureaucrats of the State
Finance Department had put in a lot of efforts to make
this budget people and employees friendly and garner their
sympathy and support for the BJP government in the
election year.
Among
various sections in the society, the major beneficiaries
of this year's budget however, will be the farmers,
general consumers and working class professionals who have
been provided relief in terms of reduction and exemption
in value added tax (VAT), octroi, professional taxes on
specific products up to certain limit. The annual budget
has also many things to cheer about for the government
employees, aganwadi workers, landless kotwars, homeguard
volunteers, part-time and `contract' employees who have
been given a healthy raise in their dearness allowances
and monthly wages, in contrary to their expectations.
Reduction
in VAT on diesel, liquor to become costly
Complying
to the promises made by the Bharatiya Janata Party in its
election manifesto, in a major decision here on Wednesday,
the state finance minister announced reduction in value
added tax on diesel from existing 26% to 25%. This is the
second consecutive time in the past two financial years
that the state government has made reduction in the VAT.
In financial year 2007-08 also, the government had reduced
VAT on diesel from 28.75% to 26%. The steps taken by the
government in this regard, will help curb inflation to a
certain extent, Raghavji hoped.
Going
further soft on the VAT and provide relief to the
consumers, the state finance minister has exempted many
products from the VAT. These products include accessories
used in sprinkles, drip irrigation, bamboo products,
umbrella, its accessories, camphor, cow urine and its
products, kerosene lantern, kerosene lamp, kerosene
chimney, hand-made candles, solar stove, religious
calendars, `prasad' given by the religious institutions
among others.
Plastic
shoes, slippers with its retail value not exceeding Rs
150, shoes, slippers manufactured in Madhya Pradesh with
retail price value not exceeding Rs 250 have also been
exempted from VAT. In order to give a boost to local
business and consumers, the government has announced
reduction in VAT rate from 12.5% to 4% on pre-recorded
audio cassettes, CDs, helmet, plywood, blackboard,
particle board, foam, plastic foam, rubber foam, sheets
made of synthetic foam, CFL bulbs and tubes with its
retail price not exceeding Rs 100, earth moving machines,
its accessories and other parts, all kind of two-whellers
(both electric and battery operated) sans internal
combustion engine, electrical energy meters and aluminum
profiles respectively. Besides, the government has also
reduced VAT on sale of used cars in the state from 12.5%
to 1.5%. This has been aimed at to give a boost to sale of
used cars in the state. On account of reduction and
exemption in VAT, the government will incur a revenue loss
of Rs 119.33 crore.
4%
raise in DA to govt employees
Similarly,
the government has also made announcement in reduction and
exemption in octroi, professional tax and stamp duty on
selective items. In an attempt to arrest problems of
cotton and spinning mills in the state and bring this
industry in competition with foreign countries, the state
finance minister has announced exemption from octroi on
cotton and other man-made yarn. Similarly sponge, iron and
iron scrap used as raw material in induction furnace have
also been exempted from octroi.
Exemption,
reduction in professional tax upto certain limit and
reduction in stamp duty are some of the major decisions
made in the current year's annual budget, Raghavji said
adding this steps will particularly prove to be beneficial
for the low income people as well as common men.
People
with an annual income not exceeding Rs 1.20 lakh have been
exempted from professional tax. Till now, annual income up
to Rs 76,000 was being exempted from professional tax.
Professional taxes on people whose annual income is
between Rs 1.20 lakh and Rs 1.50 lakh and between Rs 1.50
to Rs 1.80 lakh, have been slashed from Rs 1500 to Rs 1000
and Rs 2500 to Rs 1500 respectively. The government has
also announced deduction in stamp duty by 0.5% on transfer
of permanent assets and documents in the state. In all the
government will incur a loss of about Rs 286 crore in its
revenue for the financial year 2008-09 on account of tax
rebates.
Among
various sectors, the state government has made the highest
allocation for irrigation sector wherein a provision of Rs
1815.57 crore has been made in the budget for the year
2008-09 for the expansion of irrigation facilities in the
state. Of the total allocation in this sector, a sum of Rs
1115.49 crore has been proposed to be spent on larger
irrigation projects, Rs 155 crores on medium projects and
Rs 526.17 crores for small irrigation projects.
After
irrigation, the road sector has attracted the highest
budgetary allocation wherein a sum of Rs 1656.50 crore has
been sanctioned for the construction of roads in the state
during the year 2008-09. Besides, an additional budgetary
provision of Rs 613.51 crore has been made in the budget
for the maintenance of road.
Agriculture
sector is one of the prominent sectors in the state which
has been attached top priority by the state government. A
provision of Rs 1241.62 crore has been made in the budget
by the state government for 2008-09 in agriculture sector,
which is 67.25% more as compared to the previous year. The
major decisions taken for the farmers in the state include
lowering of interest rate from 7% to 5% on short-term
agriculture loans to farmers, increase in government grant
from 10 to 30% to promote drip and sprinkler irrigation in
the state and a bonus of Rs 100/quintal to farmers in
addition to minimum support price on wheat being given to
the farmers by government Agencies in the state.
In
the energy sector, the government has earmarked a sum of
Rs 341.47 crore for the power projects and a sum of Rs
1240.91 crore for strengthening transmission and
distribution of power, which include a sum of Rs 713.03
crore provided by the Asian Development Bank. In addition
to this, the state budget has made a provision of Rs 100
crore for separating house-hold power distribution in
rural areas. State finance minister informed that the
government in order to attract private investment in power
generation, had signed memoranda of understandings (MOUs)
with 22 companies with an accumulated power generation
capacity of 24785 mw.
Talking
about the steps taken by the state government in education
sector, Raghavji said that under the `Sarv Shiksha Abhiyan',
the state had witnessed tremendous improvement as far as
development of infrastructure in primary education and
enrollment of students in primary schools are concerned.
Government has earmarked a sum of Rs 617.55 crore as its
contribution for the implementation of the `Sarv Shiksha
Abhiyaan' in the state. In order to further bring about
qualitative improvement in education system, the finance
minister announced creation of 15,439 posts of teachers.
To enable students get bank loans for higher studies, a
cell will be constituted to provide guarantee to students
as and when required.
In
health sector, the state finance minister informed about
implementation of Deendayal Mobile hospital scheme started
in tribal blocks of the state with an objective to expand
health facilities. Warehouses have been set up in 27
districts of Madhya Pradesh to ensure availability of
medicines. The budget talks about implementation of the
national health insurance schemes in 10 districts of the
state from next year for the workers of unorganized
sector. Under the scheme, the insurance company will borne
out expenses of the treatment of beneficiaries up to Rs
30,000.
Under
the urban development scheme of the state government, the
budget has made a provision of Rs 1573.62 crore as taxes
collected by the government from civic and panchayat
bodies. Raghavji informed that under the Jawaharlal Nehru
Urban Renewal Mission scheme, a sum of Rs 1858.50 crore
has been earmarked for the execution of as many as 34
developmental schemes in the cities of Bhopal, Indore,
Ujjain and Jabalpur respectively.
A
sum of Rs 38.50 crore and Rs 20 crore has been earmarked
to boost tourism and civil aviation sector in the state.
Private participation has been incorporated for the
maintenance of government aerodromes and a liberal policy
has been framed for the development of heritage hotels.
Under the destination tourism project, natural as well as
areas of religious importance will be developed.
Under
the employees welfare programmes, the government has
announced an increase in dearness allowance of the
government employees by 4%. This will be effective with
effect from April 1, 2008. Accordingly, government
pensioners will also get benefit of the dearness
allowances. Raghavji informed that the state government
was also simplifying rules to facilitate appointment on
compassionate ground in case of deaths of government
employees.
In
order to compensate for the losses to be incurred by the
state government from reduction and exemption in octroi,
professional tax, VAT and stamp duty, the government has
announced imposition of excise duty on the import of
foreign liquor, production of foreign liquor by local
industries, bottling of foreign liquor and beer in the
state. Hike in excise taxes will generate an additional
revenue of Rs 20.66 crore.
Cheaper:Kripan,
hand anklet, prasad, religious calenders, camphor, cow
urine products, cooked dalia, satoo, nonbranded brooms,
kerosene lantern, kerosene lamps, hand-made candles, solar
stove, bamboo products, umbrellas and its accessiories,
taatpatti, sprinklers, drip irrigation accessories,
recorded and pre-recorded audio cassettes and CDs, helmet,
all kinds of plywood, black boards, foam, plastic foam,
rubber foam, sheets made of synthetic foams, CFL bulbs,
tubes, earth movers machines and its parts, electric and
battery operated two-whellers sans internal combustion
engine, electrical energy meters, aluminum profiles, etc.
Dearer:
Foreign liquor, spirit, beer, rectified spirit, liquor,
beer bottling, travel on nationalized routes, etc.
Source
: Central Chronicle - Bhopal, India, dated 27/02/2008
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