Maharashtra Finance Minister Ajit Pawar on Monday presented a Budget for 2021-22 with a revenue deficit of ₹46,177.59 crore for 2020-21 owing to a shortfall in estimated revenue receipts amid the COVID-19 pandemic.
In his Budget speech, Mr. Pawar said he was unable to announce freebies owing to the State’s strained financial situation. In the last two years, the State’s debt has increased by ₹1,64,056 crore.
According to the Budget estimate (2021-22), debt has risen to ₹6,15,170 crore compared with the revised estimate (2020-21) of ₹5,38,304 crore. The debt stock percentage compared with the Gross State Domestic Product stands at 20.6%. In the previous fiscal, it was 20.2%.
Mr. Pawar said the State is yet to receive over ₹30,000 crore as compensation from the Centre for implementing the Good and Services Tax. “Since Parliament has passed the law, we expect to receive the amount before March 31. In case we do not, the deficit will further increase,” he said.
Mr. Pawar said he expected revenue receipts worth ₹3,68,986.86 crore in 2021-22 and the revenue deficit to dip to ₹10,225.66 crore. “We have tried to focus more on capital expenditure and cut down on revenue spend. We would have liked to slash taxes on fuel to give relief to citizens, but we can’t as we are staring at reduced revenue generation,” he said.
The Budget has, however, proposed to increase the excise duty on liquor. Country liquor will be classified into two categories — branded and non-branded — and State Excise Duty will be levied at 220% of manufacturing cost or ₹187 per litre, whichever is higher, only on branded country liquor.
VAT to be hiked
It has also proposed to increase the VAT on the sale of liquor as prescribed in Schedule B of the Value Added Tax Act from the existing 60% to 65%, and the VAT as prescribed in Section 41 (5) of Act from the 35% to 40%.
