State Finance Minister Shri Prafulla Ghadai presenting the Budget on Friday
State Finance Minister Shri Prafulla Ghadai presenting the Budget on Friday
Bhubaneswar: State Finance Minister Prafulla Chandra Ghadai on Friday presented the highest-ever Rs 52,755.15 crore Budget for Odisha for the financial year 2012-13, while raising the lowest slab of VAT from 4 per cent to 5 per cent, making essential items like medicine, steel and foodgrains costlier.

While the State’s annual budget for 2012-13 is estimated at Rs 52,755.15 crore, the size of non-plan expenditure is estimated at Rs 35,070.8 crore while the size of the State plan and central plan is estimated at Rs 15,204.14 crore and Rs 829.78 crore respectively. The size of the Centrally-sponsored plan has been estimated at Rs 1,650.43 crore.

The total revenue expenditure is estimated at Rs 43,842.74 crore during 2012-13. Therefore, after achieving revenue balance, the minister said a surplus of Rs 2410.77 crore has been projected. But the fiscal deficit is projected at Rs 4751.75 crore.

Explaining the reason behind the increase in the minimum slab of VAT he said that there was a consensus at the empowered committee of State finance ministers on this and it was also linked to grant of Central Sales Tax (CST) compensation by the Centre.

However, Ghadai clarified that the raising of the lower rate of VAT would not affect the prices of essential commodities as most of the packaged commodities and medicines are being sold on MRP.

He said that prices of several essential commodities and food items will go up at the rate of five per cent under the VAT Act with effect from April 1, 2012, and justified the Government’s move stating that after both the commodities were removed from the schedule to the Additional Duties of Excise Act-1957, these goods became liable to VAT from April 8, 2011.

However, Ghadai said the additional revenue to accrue from the new tax proposal would be fully utilised for increasing the amount of pension being paid to more than 37 lakh old, widowed and differently abled persons from Rs 200 to Rs 300 per month from April 1, 2012.

Ghadai said, “The Budget proposals seek to further consolidate and strengthen the interventions made for ensuring food, employment and health security for the citizens of the State.”

He said higher allocations have been made for ongoing welfare schemes launched by the State Government like the Re 1 per kilo rice, Mamata Scheme for pregnant women, Mo Kudia (housing for poor people), bicycles to SC and ST students and medicine and diet for patients.

Apart from this budgetary allocation has been made for Biju Setu Project, emergency ambulance service, synthetic hockey turf, Rs 30 crore for infrastracture development in three State run medical colleges and theSstate’s second Planetarium at Sambalpur, Ghadai said.

Ghadai said priority has been given to agriculture, irrigation and development sectors. He said allocation for the agriculture department has been substantially stepped up from Rs 1,167.98 crore in 2011-12 to Rs 1,516.16 crore in 2012 with an increase of 42.64 per cent.