MP slaps new entry tax; to clear Pay Commission dues

Madhya Pradesh today presented the Budget for 2010-11, which proposes a two per cent entry tax on a number of items including leather goods, SIM cards and carpets, and provides for implementation of the Sixth Pay Commission recommendations to government employees.

The state government also doubled to two per cent, the entry tax on electronic equipment used for domestic and industrial purposes, colour television sets, cinematographic equipment, electronic toys, crockery, cutlery, confectionery, photo copying machines, marble and granite tile and paint.

But despite the new tax proposal, the state would end this fiscal with a deficit of Rs 128 crore.

"Although receipts during 2010-11 would be Rs 51,570 crore, the expected expenditure would be Rs 51,507 crore which means a surplus of Rs 63 crore, yet the year will end with a deficit of Rs 128 crore," Finance Minister Raghavji said in his Budget speech.

Highlighting the progress made by the state during the BJP rule since 2003, he said the per person income, which was Rs 12,697 in 2002-03, rose to Rs 21,648 in 2008-09.

The state government, which had announced implementation of recommendations of the Sixth Pay Commission with effect from January 1, 2006, has made a provision of Rs 1,017 crore in the Budget to pay arrears from January one, 2006 to August 31, 2008, Raghavji said.

While revenue losses in 2001-02 were Rs 3,167 crore, they were expected to show a surplus of Rs 1,698 crore in 2009-10.

The Minister said while revenue receipts were expected to be Rs 43,443 crore, revenue expenditure was likely to be Rs 41,863 crore, translating into a revenue surplus of Rs 1,580 crore.

Fiscal deficit for 2010-11 was expected to be Rs 8,003 crore which was 4 per cent of the Gross Domestic Product (GDP) and well within the guidelines given by the Centre, he said.

He also listed the activities that would be undertaken by various departments in the field of road construction, power, irrigation, drinking water and agriculture.

The Minister said the two per cent entry tax would also be applicable on ice boxes, thermos flasks, aircraft and their parts.