Bihar Finance Minister Sushil Kumar Modi on Friday presented the Rs. 65,325.87 crore annual budget in the Assembly for 2011-12 having a marginal deficit of Rs. 13.03 crore.
The State’s total expenditure has been proposed at Rs. 65,325.87 crore against the proposed total receipts of Rs. 65,312.84 crore, Mr. Modi, who is also Deputy Chief Minister, told reporters here after an hour-long budget presentation in the Assembly.
In spite of an overall deficit of Rs. 13.03 crore in the budget, the State has a proposed revenue surplus of Rs. 6,272.30 crore which will be spent on the development and welfare projects, he said.
The surplus revenue proposed in the budget for 2011-12 too has registered a slight decline of Rs. 285 crore.
The State’s fiscal deficit too has increased marginally in percentage terms of the state’s gross domestic product (GDSP) at 2.93 per cent (Rs. 6,194 crore) in 2011-12 against 2.73 per cent (Rs. 45,940 crore) in 2010-11.
Mr. Modi, however, expressed confidence that the State government will be successful in sound fiscal management in spite of the large size of its plan, necessary loan payment and increased revenue expenditure.
The fiscal deficit will remain within stipulated limit of three per cent of the SGDP as prescribed by Fiscal Responsibility and Budget Management (FRBM) rules prescribed by the Centre, he added.
In an indication that road connectivity, education and agriculture continue to be the priorities in the next fiscal too, Road Construction, Human Resources Development and the Water Resources departments have bagged the lion’s share of the State plan outlay for 2011-12 at Rs. 3,875, Rs. 3,014 and Rs. 2,112 crore respectively, the Deputy Chief Minister said.
Among other significant proposals in the state budget, Mr. Modi has allocated Rs. 644.58 crore for a new scheme - the Chief Minister’s Development project - for development works in various parts of the State for which the concerned MLAs will be required to make a recommendation for works.
In another significant budgetary proposal, Rs. 299.99 crore has been provisioned in the budget for purchase of foodgrains for distribution among those BPL families who were deprived of the benefits under the central scheme, Mr. Modi said.
The State government has provisioned funds of Rs. 210 crore and Rs. 250 crore for promotion of food processing industries and panchayat bhawans respectively, he said.
In addition, the State government has proposed funds of Rs. 126 crore, 175 crore and Rs. 153 crore for the Chief Minister’s scheme for dress to the students, grants for bicycle for boys and grants for bicycle for girls respectively.
The Chief Minister’s bridge construction project has been allocated an amount of Rs. 400 crore, while the The Chief Minister’s rural approach road project has been granted Rs. 300 crore in the budget.
The Deputy Chief Minister also announced various sops for the common man making certain foodgrains like paddy, wheat, rice, flour and suji tax free, while the bone mill has been included among natural fertilisers and made tax free.
The State government proposed to increase value added tax (VAT) on certain goods in schedule three of the VAT Act, 2005, from four to five per cent.
The VAT on various consumer goods like motor vehicle, TV, fridge, jarda/cigarette, cement, soaps, detergent, tooth paste/tooth brush, electrical appliances and furnitures have been hiked from the present 12.5 per cent to 13.5 per cent.
The State government has also proposed to bring an amendment in the motor vehicles tax fixation act to hike from the present three per cent to five per cent on purchase of motorcycles and car in order to raise an additional revenue of Rs. 40 crore, Mr. Modi said.
Similar, a luxury tax of 10 per cent has been imposed on the booking of hotels, conference halls, community centres, while the state government also proposed to hike export/import tax on beer, Indian/foreign liquor, spicy liquor, the Deputy Chief Minister said.
The State government has further proposed to rationalise tax rates on various categories of heavy vehicles like trucks in order to give incentive for more registration of such vehicles in the State for the purpose of generation of employment opportunities in the transport sector, he said.