Initiating several steps for improvement in tax collection, preventing leakages and checking evasion, the State Budget for 2013–14 has projected revenue receipts growth of 20.28 per cent (over the budget estimate for 2012–13), while tax revenues are projected to increase by about 19 per cent.
Not altering the value added tax (VAT) which was increased last year, Chief Minister Siddaramaiah is expected to mobilise adequate revenue to the State exchequer to implement several schemes announced earlier, including Anna Bhagya rice scheme and waiver of loans borrowed by minorities and Scheduled Castes and Tribes.
“We need to raise additional resources to meet the several development schemes and other initiatives announced by me,” the Chief Minister said.
Loans from the Union government, open market, institutions and recoveries from loans etc. are projected to increase 12 per cent (Rs. 19,909.42 crore) over the previous budget estimates (Rs. 17,658.92 crore).
The State’s projected revenue receipts stand at Rs. 97,986.38 crore and while the expenditure pegged at Rs. 97,390.53 crore during the year. The projected expenditure was 20.93 per cent more than the budget estimates of 2012–13 (Rs. 80,529.98 crore).
The government plans to mobilise Rs. 37,740 crore from commercial taxes, which constituted 61 per cent of the State’s own tax. Collection from stamps and registration are targeted at Rs. 6,500 crore (10 %), motor vehicle tax Rs. 4,120 crore (7 %), excise Rs. 12,600 crore (20 %), others Rs. 1,504 crore (2 %).
To meet additional resources required for social welfare schemes, Mr. Siddaramaiah proposed to continue to implement increased VAT rates. In view of the drought, VAT rates increased from five per cent to 5.5 per cent and 14 per cent to 14.5 per cent for a period of one year in August last. Now, the budget proposed to continue this increase beyond July 31, 2013. With this, the VAT rates would remain unchanged.
To mobilise more revenue, the budget proposed to fill vacant posts in tax department, simplification of tax processes, collection of arrears, speedily disposed of tax appeal cases, implementation of recommendations of expenditure reforms commission, attention to reduce the losses of state road transport corporations, swapping of high interest loans, and need-based borrowings
The projected receipts from States taxes stood at Rs. 62,464 crore (51%), borrowings Rs. 22,396 crore (18%), share of Central taxes Rs. 15,055.99 crore (13%), grants from Central government Rs. 16,428.11 crore (14 %), non-tax revenue Rs. 4,038.8 crore (3%), and public account Rs. 972.97 crore (1 %). The total projected receipts are Rs. 97,986.38 crore in 2013–14.
The State’s own tax revenue is estimated to be Rs. 62,464 crore with an increase of 20.5 per cent over the budget estimate for 2012–13. Various boards and corporations and local bodies are expected to mobilise Rs. 7,002 crore though internal resource generation and borrowings made on the basis of their own strength.
Social services constituted major source of expenditure — 38.74 per cent followed by economic services – 28 per cent and general services – 26 per cent.