State will maintain a revenue surplus and a fiscal deficit within 3 per cent of the GSDP
The State's revenue receipts are expected to touch the Rs.1 trillion mark in the next financial year.
For 2012-2013, revenue receipts have been projected at Rs.1,00,589.92 crore, of which the State's Own Tax Revenue (SOTR) will contribute Rs.71,460.55 crore. The State's non-tax revenue will be Rs.6,032.61 crore. The share in Central taxes is estimated at Rs.15,032.47 crore and grants-in-aid from the Government of India are expected to bring in Rs.8,064.29 crore. Revenue expenditure has been estimated at Rs.98,213.85 crore and salaries and pensions will add up to 43 per cent of the revenue expenditure.
Giving the figures, Finance Minister O. Paneerselvam said that the total allocation for capital expenditure would be Rs.20,856.08 crore and the total provision for loans and advances, Rs.1,352.12 crore. The fiscal deficit would be Rs.19,832.13 crore, constituting 2.87 per cent of the Gross State Domestic Product (GSDP).
Pointing out that the Budget conformed to the norms of fiscal prudence set by the Thirteenth Finance Commission, the Minister said the State would maintain a revenue surplus and a fiscal deficit within 3 per cent of the GSDP. The total debt by the end of 2012-2013 was expected to be Rs.1,35,060.47 crore, constituting only 19.6 per cent of the GSDP, as against the ceiling fixed by the Commission for Debt-GSDP ratio of 24.8 per cent.
In tune with Chief Minister Jayalalithaa's promise that government's debt should be controlled, this year's net borrowing had been restricted to Rs.12,873.81 crore whereas the Revised Budget Estimate was Rs.16,105.86 crore.
“Further, we are programming to borrow only Rs.18,387.47 crore, though the total borrowing entitlement given by the Government of India is Rs.20,716 crore,” the Minister said, adding that the net borrowing was lower than the projected capital expenditure, showing that it was going to finance capital expenditure alone.
Asked whether the government was ambitious in fixing its projection for the next year's revenue receipts, Principal Secretary (Finance) K. Shanmugam, in an interaction with reporters, denied it and said the government went by the past growth rate figures. The proposed growth rate in commercial taxes was 17.42 per cent and that of State Excise – 16 per cent. “It is a reasonable projection of growth rate.”
He explained that of the State's Own Tax Revenue, commercial taxes would account for around 75 per cent.
As regards the levy of value added tax on alcohol, Mr. Shanmugam explained that there would be no rate revision at the end of manufacturer or seller. Till now, there was no tax at the final point of sale that covered hotels, bars and restaurants, which was sought to be brought under the tax net.