Belagavi Nov 18: The Siddaramaiah government on Friday allayed fears of a slowdown in economy due to recent structural reforms initiated by the Centre like Goods and Sevices Tax (GST). Instead, the government stressed that it will boost the economy in the medium and long term.
"Recent structural reforms are seen to have a slight impact on growth in the short run. However, they are expected to boost medium-to-long-term growth prospects," the government said in its report on Mid-Year Review of State Finance 2017-18 (April to September) tabled in the Legislative Assembly.
The government observed that teething troubles related to GST need to be addressed expeditiously, besides making concerted efforts to encourage investment by removing various bottlenecks. The report is prepared by the State Finance department, the portfolio held by Chief Minister Siddaramaiah.
Interestingly, the observation made in the report is in contradiction to the Congress' stand on the GST. AICC vice president Rahul Gandhi had described GST as Gabbar Singh Tax, as the party staged a nation-wide protest against it recently.
The state's revenue receipts have witnessed a healthy growth during the past six months. All major sources of own tax revenues Commercial Taxes, Excise, Motor Vehicle Taxes and Stamps and Registration -- have shown "reasonable achievement". "Collection under these sources are a notch higher than FY 2016-17 for the same period," the report stated.
The state has collected Rs 6,190 crores revenue during July and August after the implementation of Goods and Sevices Taxes (GST), including SGST of Rs 4,100 crores. The state should have collected Rs 6,640 crores at 14% growth rate. As per the Compensation Act, the Centre will compensate the difference in amount of Rs 450 crores to the state, the report added.
Increase IML sale: Panel
The Fiscal Management Review Committee (FMRC) headed by the Chief Secretary has asked the Excise department to take proactive measures to increase the sale of Indian Made Liquor (IML) in the state.
The panel, which has made certain recommendations to the government after reviewing the fiscal and debt position of the state, has observed that sale of IML has reduced in the state compared to neighbouring States.
Registration of motor vehicles too has dipped in the past few years, the panel stated and asked the Transport department to rationalise the tax structure and resolve issues related to lifetime tax in order to improve the registration.
The committee has cautioned the government on the ballooning expenditure commitments – mainly on account of crop loan waiver, and advised it to take necessary measures to increase its revenue.
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