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| Gujarat introduces tax on DTH |
| BS Reporter / Mumbai/ Ahmedabad Jul 01, 2009, 00:42 IST |
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Maintains status quo with regard to present tax and sop provisions.
The Gujarat government on Tuesday, in its Budget for the fiscal 2009-10, preferred not to impose any new taxes except entertainment tax on Direct-to-Home (DTH) service.
The Budget presented by state finance minister Vajubhai Vala also avoided offering tax sops or relief to consumers or industries.
Considering the fiscal necessities and responsibilities of the state, the government decided to maintain status quo with regard to present tax and sop provisions.
The 2009-10 Budget with a surplus of Rs 47.76 crore has proposed only entertainment tax on DTH connections at Rs 200 per connection annually. The new tax is estimated to contribute a meagre Rs 6 crore to the state exchequer.
At present, Gujarat levies entertainment tax on cable TV at Rs 6 and Rs 4 per annum in urban and rural areas respectively. The entertainment tax on cable TV generates an annual revenue of Rs 7 crore for the state.
Justifying the entertainment tax on DTH, Vala said, “The rich and the upper middleclass use the DTH facility and they don’t have to pay any tax for using the service. On the other hand, poor and middleclass are charged entertainment tax for using cable TV, which leads to injustice to them. In order to avoid imbalance, entertainment tax on DHT has been imposed.”
The size of the Budget has been increased 9 per cent at Rs 57,487.91 crore over the 2008-09 Budget, which also includes revenue receipts of Rs 41,815.18 crore.
As against the total income, the state expenditure for the current fiscal is estimated to be Rs 57,440.15 crore, resulting in a surplus of Rs 47.76 crore. With an additional income of Rs 6 crore per annum on account of entertainment tax on DTH, overall, the surplus for 2009-10 will be Rs 53.76 crore.
In bid to provide momentum to various sectors, the state government has also raised the annual plan size by 11 per cent at Rs 23,275 crore. Social services remained the highest priority with Rs 10,150 crore allocation, which represents 43.61 per cent of the total plan size. The state has allocated Rs 5,570.20 crore for irrigation and flood control and Rs 1,745 crore for agriculture and allied services.
Talking about the revenue deficit, Vala said, “Our share of revolution fund, which comes from the central government has gone down by Rs 600 crore. Add to that, the Centre has not paid us the CST compensation worth Rs 1,000 crore. Even the royalty on oil worth Rs 1,500 crore that we used to get from the Centre has stopped suddenly for no apparent reason. A large financial burden on the state has also risen due to the implementation of Sixth Central Pay Commission recommendations, which amounts to over Rs 4,000 crore in 2009-10 alone, on account of 20 per cent arrears, and an incremental recurring expenditure due to revision of pay and pension. All this has resulted in a heavy deficit for the state.” Gujarat’s deficit on revenue account for 2009-10 has been estimated at Rs 3,913.19 crore.
“Apart from launching couple of new schemes, we have continued to focus on three main schemes namely Vanbandhu (for tribals), Sagarkhedu (for fishing community) and Saheri Garid (urban poor) announced in the last budget,” he said.
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