Special Correspondent
The State Budget 2022-23 will be about practical solutions to keep the economy chugging and managing revenues on an even keel, even as it attempts to nudge the economy forward as it shows signs of revival following the ebb in the pandemic situation, Finance Minister K.N. Balagopal has indicated.
''Don't expect any magic, though,'' Mr. Balagopal, who is scheduled to present his maiden full Budget in the Kerala Assembly on Friday, said during a pre-Budget chat here on Tuesday. In June last year, he had presented a revised Budget for 2021-22 when the present Left Democratic Front (LDF) government came to power.
Major tax revisions were unlikely, but a ''restructuring'' could be expected in some areas to keep the money coming in, the Finance Minister said. ''There is little scope for big tax proposals as that now mostly falls within the ambit of the Centre. At the State-level, liquor is already taxed at a good rate. Fuel prices are also high at present. But in some areas, there will be timely restructuring,'' he said. There will be emphasis on improved tax collection and curbing evasion as well.
The big challenges before the State, Mr. Balagopal said, were the 'adverse' fiscal policies of the Centre, including the imminent fall in revenues with the discontinuation of Goods and Services Tax (GST) compensation in June. The State's share from the divisible pool is down to 1.94%.
''It's like walking the tight-rope. I strongly believe we can move ahead by avoiding a dangerous situation. The growth trend in GST and overall tax collection is evident. So is the trend of the economy picking up. But we need collective action to get the Centre to do more,'' he said.
That said, the expectation appears to be strong that the Centre would come up with a solution, given the pressure from the States to extend the GST compensation regime beyond 2022.
The State Budget is expected to give thrust to knowledge economy initiatives and digital solutions in governance. It will take serious note of value addition in agriculture and traditional industry as a means of income and employment generation, fine-tuning skilling schemes and encouraging research and incubation in higher education, Mr. Balagopal said.
In the days ahead, the Kerala Infrastructure Investment Fund Board (KIIFB) would be used as a growth engine for core projects, he said. While the KIIFB was a successful model and its role in infrastructure development was now quite evident, it cannot be used at the current pace every year, he said.
